What is The Lovesac Co Probability of Financial Distress (%)?
Probability of Financial Distress (%) measures the probability that a company will go bankrupt in the upcoming year given its current financial position. A higher ratio indicates a larger probability of bankruptcy for the company, while a lower ratio indicates a healthier fundamental. As of today, The Lovesac Co's Probability of Financial Distress (%) is 0.03%.
Like the Altman Z-Score, the PFD measures a company's bankruptcy risk. However, the main drawback of the Z-score is it does not apply to banks and insurance companies. According to Investopedia, the concept of "working capital" does not apply to banks and insurance companies, as financial institutions do not have typical current assets or current liabilities like inventories or accounts payable.
Competitive Comparison of The Lovesac Co's Probability of Financial Distress (%)
For the Furnishings, Fixtures & Appliances subindustry, The Lovesac Co's Probability of Financial Distress (%), along with its competitors' market caps and Probability of Financial Distress (%) data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
The Lovesac Co's Probability of Financial Distress (%) Distribution in the Furnishings, Fixtures & Appliances Industry
For the Furnishings, Fixtures & Appliances industry and Consumer Cyclical sector, The Lovesac Co's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where The Lovesac Co's Probability of Financial Distress (%) falls into.
The Lovesac Co Probability of Financial Distress (%) Calculation
Probability of Financial Distress (%) (PFD) was developed by John Campbell, Jens Hilscher and Jan Szilagyi in their Search of Distress Risk. It measures the probability that a company will go bankrupt within the next 12 months given its current financial position.
The Probability of Financial Distress (%) was obtained by a logit probability model based on eight explanatory variables. The logit formula to compute the probability of financial distress (LPFD) is given below:
| LPFD | = | -20.12 * NIMTAAVG | + | 1.60 * TLMTA | - | 7.88 * EXRETAVG | + | 1.55 * SIGMA | - | 0.005 * RSIZE | - | 2.27 * CASHMTA | + | 0.070 * MB | - | 0.09 * PRICE | - | 8.87 |
| = | -8.08 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.03% |
The eight explanatory variables are:
1. NIMTAAVG = Net Income to Market Total Assets
*Note that for companies reported quarterly, geometrically declining weighted quarterly Net Income data in latest four quarters are used.
2. TLMTA = Total liabilities to Market Total Assets
3. CASHMTA = Cash to Market Total Assets
For non-financial companies, CASHMTA is measured as:
4. EXRETAVG = Excess Return compared to the S&P 500
EXRETAVG is the weighted excess return compared to the S&P 500 in past 12 month. Geometrically declining weights are imposed on the monthly excess return to reflect lagged information. The weight is halved each quarter.
5. SIGMA = Standard Deviation of Daily Returns
For sigma, we use the annualized standard deviation of a company's returns over the past 92 days (or 63 trading days).
6. RSIZE = Relative Size
| RSIZE | = | log (Market Cap | / | Total Market Cap of S&P 500 companies) |
7. MB = Market to Adjusted Book Equity Ratio
8. PRICE
PRICE is measured as the log of the stock price, capped at log(15).
The Lovesac Co (The Lovesac Co) Business Description
Traded in Other Exchanges
N/A
Address
Two Landmark Square, Suite 300, Stamford, CT, USA, 06901
The Lovesac Co designs, manufactures and sells alternative furniture which is comprised of modular couches called sactionals and premium foam beanbag chairs called sacs. It also offers other accessories such as sactional-specific drink holders, Footsac blankets, decorative pillows, fitted seat tables and ottoman. Its products are sold across the United States through its website or company-owned retail stores which are used in homes and offices. Majority of the firm's revenue gets derives from the sale of Sactionals.
Executives
| Andrew R Heyer |
director, 10 percent owner |
501 MADISON AVENUE, FLOOR 5, NEW YORK NY 10019 |
| Shawn David Nelson |
director, officer: Chief Executive Officer |
2 LANDMARK SQUARE, SUITE 300, STAMFORD CT 06820 |
| Satori Capital, Llc |
10 percent owner |
2501 N. HARWOOD ST., 20TH FLOOR, DALLAS TX 75201 |
| Keith R. Siegner |
officer: EVP and CFO |
TWO LANDMARK SQUARE, SUITE 300, STAMFORD CT 06901 |
| Vineet Mehra |
director |
330 HUDSON STREET, 13TH FLOOR, NEW YORK NY 10013 |
| Sharon M Leite |
director |
100 PIER 1 PLACE, FT. WORTH TX 76102 |
| Shirley Romig |
director |
TWO LANDMARK SQUARE, SUITE 300, STAMFORD CT 06901 |
| Albert Jack Krause |
director, officer: President and COO |
2 LANDMARK SQUARE, SUITE 300, STAMFORD CT 06820 |
| Walter Field Mclallen |
director |
1225 17TH AVE SOUTH, NASHVILLE TN 37212 |
| Mary Fox |
director |
TWO LANDMARK SQUARE, SUITE 300, STAMFORD CT 06901 |
| Mistral Equity Partners, Lp |
10 percent owner |
650 FIFTH AVENUE, 31ST FLOOR, New York NY 10019 |
| Mistral Sac Holdings, Llc |
10 percent owner |
650 FIFTH AVENUE, FLOOR 10, NEW YORK NY 10019 |
| Jared Rubin |
director |
4300 E. FIFTH AVE., COLUMBUS OH 43219 |
| Sac Acquisition Llc |
10 percent owner |
700 CANAL STREET, 4TH FLOOR, STAMFORD CT 06902 |
| Donna Dellomo |
officer: Executive VP and CFO |
35 SAWGRASS DRIVE, SUITE 2, BELLPORT NY 11713 |
The Lovesac Co (The Lovesac Co) Headlines
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