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, Cathay Real Estate Development Co's Probability of Financial Distress (%) is 0.04%.
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.
Cathay Real Estate Development Co (TPE:2501) 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.
Cathay Real Estate Development Co Probability of Financial Distress (%) Related Terms
Cathay Real Estate Development Co Probability of Financial Distress (%) Competitor Comparison
For the Real Estate - Development subindustry, Cathay Real Estate Development 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.
Cathay Real Estate Development Co Probability of Financial Distress (%) vs Real Estate Industry
For the Real Estate industry and Real Estate sector, Cathay Real Estate Development Co's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Cathay Real Estate Development Co's Probability of Financial Distress (%) falls into.
Cathay Real Estate Development 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
=
-7.77
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 0.04% mean?
Cathay Real Estate Development Co (TPE:2501) has a Probability of Financial Distress (%) of 0.04% as of Jul. 06, 2026.
Is Cathay Real Estate Development Co's Probability of Financial Distress (%) too high?
Cathay Real Estate Development Co's current Probability of Financial Distress (%) is 0.04%. Overall, Cathay Real Estate Development Co has a GF Score™ of 85/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Cathay Real Estate Development Co's Probability of Financial Distress (%) compare to competitors?
Cathay Real Estate Development Co's Probability of Financial Distress (%) of 0.04% can be compared against companies in the Real Estate 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 a Real Estate company?
A good Probability of Financial Distress (%) depends on the Real Estate 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. Cathay Real Estate Development Co's current Probability of Financial Distress (%) is 0.04%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Cathay Real Estate Development Co stock overvalued right now?
Based on GuruFocus' analysis, Cathay Real Estate Development Co (TPE:2501) is currently considered Fairly Valued. The stock's GF Value™ is NT$25.43, compared to a current price of NT$24.75 — trading 2.7% below its estimated fair value. The current Probability of Financial Distress (%) is 0.04%. Cathay Real Estate Development Co's overall GF Score™ is 85/100 with 7 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 Cathay Real Estate Development Co (TPE:2501), the current Probability of Financial Distress (%) is 0.04% as of Jul. 06, 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 Cathay Real Estate Development Co (TPE:2501) Overvalued in 2026?
Based on GuruFocus' analysis, Cathay Real Estate Development Co stock appears to be undervalued.
The current stock price of NT$24.75 is trading 2.7% below its estimated GF Value™ of NT$25.43.
GuruFocus considers Cathay Real Estate Development Co to be Fairly Valued.
Key valuation signals for TPE:2501:
Probability of Financial Distress (%): 0.04%
GF Value™: NT$25.43 vs. price of NT$24.75 (2.7% below fair value)
No single metric tells the full story. See the TPE:2501 stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Cathay Real Estate Development Co Business Description
Cathay Real Estate Development Co Ltd is engaged in commissioning contractors to build residential and commercial buildings for leasing and selling, and provides services in real estate, health management, tourism, and hospitality in Taiwan and around the world. The Group operates through the Property and Real Estate Development department, which generates maximum revenue and is responsible for commissioning construction contractors to build residential and commercial buildings for lease or sale, and equipment leasing operations, and the Construction department, which is engaged in construction contracting and construction management. Its projects include Urban Harmony in Taipei City and Taoyuan City, Park Front Row and Cathay Grand Park in Taoyuan City, and others.
85GF Score
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Probability of Financial Distress (%) is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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