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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, Huntington Ingalls Industries's Probability of Financial Distress (%) is 0.05%.
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.
Huntington Ingalls Industries (MIL:1HII) Probability of Financial Distress (%) Explanation
Like the Altman Z-Score, the PFD measures a company's bankruptcy risk in the upcoming year. 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.
Huntington Ingalls Industries Probability of Financial Distress (%) Related Terms
MIL:1HII vs DRS, MOG.A, SARO: Probability of Financial Distress (%) Comparison
For the Aerospace & Defense subindustry, Huntington Ingalls Industries'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.
Huntington Ingalls Industries Probability of Financial Distress (%) vs Aerospace & Defense Industry
For the Aerospace & Defense industry and Industrials sector, Huntington Ingalls Industries's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Huntington Ingalls Industries's Probability of Financial Distress (%) falls into.
Huntington Ingalls Industries 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
=
-7.65
The Probability of Financial Distress (%) (PFD) was then obtianed by:
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).
What does a Probability of Financial Distress (%) of 0.05% mean?
Huntington Ingalls Industries (MIL:1HII) has a Probability of Financial Distress (%) of 0.05% as of Aug. 05, 2026.
Is Huntington Ingalls Industries' Probability of Financial Distress (%) too high?
Huntington Ingalls Industries' current Probability of Financial Distress (%) is 0.05%. Overall, Huntington Ingalls Industries has a GF Score™ of 60/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Huntington Ingalls Industries' Probability of Financial Distress (%) compare to DRS and MOG.A?
Huntington Ingalls Industries' Probability of Financial Distress (%) of 0.05% can be compared against companies in the Aerospace & Defense industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Probability of Financial Distress (%) for an Aerospace & Defense company?
A good Probability of Financial Distress (%) depends on the Aerospace & Defense industry context. However, Probability of Financial Distress (%) should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Probability of Financial Distress (%) mean?
A high Probability of Financial Distress (%) can signal that a stock is expensive relative to its fundamentals. Huntington Ingalls Industries's current Probability of Financial Distress (%) is 0.05%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Huntington Ingalls Industries stock overvalued right now?
Based on GuruFocus' analysis, Huntington Ingalls Industries (MIL:1HII) is currently considered Fairly Valued. The stock's GF Value™ is €252.87, compared to a current price of €279.00 — trading 10.3% above its estimated fair value. The current Probability of Financial Distress (%) is 0.05%. Huntington Ingalls Industries' overall GF Score™ is 60/100 with 5 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Probability of Financial Distress (%) calculated?
Probability of Financial Distress (%) is calculated from a company's financial statements. For Huntington Ingalls Industries (MIL:1HII), the current Probability of Financial Distress (%) is 0.05% as of Aug. 05, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
Is Huntington Ingalls Industries (MIL:1HII) Overvalued in 2026?
Based on GuruFocus' analysis, Huntington Ingalls Industries stock appears to be overvalued.
The current stock price of €279.00 is trading 10.3% above its estimated GF Value™ of €252.87.
GuruFocus considers Huntington Ingalls Industries to be Fairly Valued.
Key valuation signals for MIL:1HII:
Probability of Financial Distress (%): 0.05%
GF Value™: €252.87 vs. price of €279.00 (10.3% above fair value)
No single metric tells the full story. See the MIL:1HII stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Huntington Ingalls Industries is the largest independent military shipbuilder in the US, spun out from Northrop Grumman in 2011. It operates three segments, two of which are storied shipyards: Ingalls produces non-nuclear-powered ships, including amphibious landing ships and Arleigh Burke-class destroyers, while Newport News produces nuclear-powered ships as the only producer of Gerald Ford-class aircraft carriers and a major subcontractor on Virginia- and Columbia-class nuclear submarines. HII shares production of destroyers and nuclear submarines with General Dynamics' Bath Iron Works and Electric Boat shipyards, respectively. The company's mission technologies segment produces uncrewed sea vessels and provides a range of IT and other services to US government agencies.
60GF Score
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