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Avis Budget Group Probability of Financial Distress (%)

: 0.00% (As of Today)
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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, Avis Budget Group's Probability of Financial Distress (%) is 0.00%.

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

For the Rental & Leasing Services subindustry, Avis Budget Group'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.

   

Avis Budget Group Probability of Financial Distress (%) Distribution

For the Business Services industry and Industrials sector, Avis Budget Group's Probability of Financial Distress (%) distribution charts can be found below:

* The bar in red indicates where Avis Budget Group's Probability of Financial Distress (%) falls into.



Avis Budget Group 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
=-11.52

The Probability of Financial Distress (%) (PFD) was then obtianed by:

PFD=1/(1 + e^(-LPFD))*100%
=0.00%

The eight explanatory variables are:

1. NIMTAAVG = Net Income to Market Total Assets

NIMTAAVG=Net Income / Market Total Assets
=Net Income / (Market Cap + Total Liabilities)

*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

TLMTA=Total Liabilities / Market Total Assets

3. CASHMTA = Cash to Market Total Assets

For non-financial companies, CASHMTA is measured as:

CASHMTA=Cash, Cash Equivalents, Marketable Securities / Market Total Assets

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).


Avis Budget Group  (NAS:CAR) 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.


Avis Budget Group Probability of Financial Distress (%) Related Terms

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Avis Budget Group Business Description

Avis Budget Group logo
Industry
Industrials » Business Services NAICS : 532111 SIC : 7514
Traded in Other Exchanges
Address
6 Sylvan Way, Parsippany, NJ, USA, 07054
Avis Budget Group Inc is a provider of automotive vehicle rental and car-sharing services. Its brands include Avis, Budget, and Zipcar. Avis is targeted to serve the premium commercial and leisure segments of the travel industry, while Budget is focused on value-conscious customers. The company operates its own network of rental locations and licenses its brands to franchisees. Zipcar is a car-sharing service that allows members to use the company-owned Zipcar fleet at an hourly rate. The company's largest region by revenue is the Americas.
Executives
Ferraro Joseph A. officer: President and CEO 6 SYLVAN WAY PARSIPPANY NJ 07054
Martins Izilda P officer: EVP, Americas 6 SYLVAN WAY PARSIPPANY NJ 07054
Sarma Karthik R. director, 10 percent owner ONE BRYANT PARK 39TH FLOOR NEW YORK NY 10036
Srs Investment Management, Llc director, 10 percent owner 1 BRYANT PARK 39TH FLOOR NEW YORK NY 10036
Hees Bernardo director, officer: Executive Chairman C/O THE KRAFT HEINZ COMPANY ONE PPG PLACE, SUITE 3200 PITTSBURGH PA 15222
Choi Brian J officer: EVP & Chief Financial Officer C/O SRS INVESTMENT MANAGEMENT, LLC ONE BRYANT PARK, 39TH FLOOR NEW YORK NY 10036
Rankin Patrick K officer: President, International 6 SYLVAN WAY PARSIPPANY NJ 07054
Lurie Glenn director C/O SYNCHRONOSS TECHNOLOGIES, INC. 200 CROSSING BLVD. BRIDGEWATER NJ 08807
Sparks Carl director 4315 NORTHAVEN ROAD DALLAS TX 75229
Krominga Lynn director 6 SYLVAN WAY PARSIPPANY NJ 07054
North John F officer: EVP & Chief Financial Officer 150 N. BARTLETT STREET MEDFORD OR 97501
Sera Jean M officer: SVP, GC & Corp. Sec. AVIS BUDGET GROUP 6 SYLVAN WAY PARSIPPANY NJ 07054
Fox Jeffrey H director ONE ALLIED DRIVE LITTLE ROCK AR 72202
Salerno F Robert director AVIS RENT A CAR INC 900 OLD COUNTRY RD GARDEN CITY NY 11530
Degenova Cathleen officer: Chief Accounting Officer 6 SYLVAN WAY PARSIPPANY NJ 07054

Avis Budget Group Headlines

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