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WAT (Waters) Probability of Financial Distress (%) : 0.03% (As of Dec. 15, 2024)


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What is Waters 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, Waters'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 Waters's Probability of Financial Distress (%)

For the Diagnostics & Research subindustry, Waters'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.


Waters's Probability of Financial Distress (%) Distribution in the Medical Diagnostics & Research Industry

For the Medical Diagnostics & Research industry and Healthcare sector, Waters's Probability of Financial Distress (%) distribution charts can be found below:

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



Waters 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
=-8.00

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

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).


Waters  (NYSE:WAT) 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.


Waters Probability of Financial Distress (%) Related Terms

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Waters Business Description

Industry
Traded in Other Exchanges
Address
34 Maple Street, Milford, MA, USA, 01757
Water sells liquid chromatography, mass spectrometry, and thermal analysis tools. These analytical instruments provide essential information on various products, such as their molecular structures and physical properties, to help clients enhance the health and well-being of end users. As a percentage of sales in 2023, Waters generated 57% from biopharmaceutical customers, 31% from industrial clients, and 12% from academic/government institutions.
Executives
Richard H Fearon director 1239 GERBING ROAD, AMELIA ISLAND FL 32034
Christopher A Kuebler director 210 CARNEGIE CENTER, PRINCETON NJ 08540
Linda Baddour director PRA INTERNATIONAL, 12120 SUNSET HILLS ROAD, SUITE 600, RESTON VA 20190
Edward Conard director
Daniel J. Brennan director BOSTON SCIENTIFIC CORPORATION, 300 BOSTON SCIENTIFIC WAY, MARLBOROUGH MA 01752-1234
Mark P Vergnano director 1007 MARKET STREET, WILMINGTON DE 19898
Gary E Hendrickson director 1101 THIRD STREET SOUTH, MINNEAPOLIS MN 55415
John M Ballbach director
Michael J Berendt director
Thomas P Salice director
Wei Jiang director 34 MAPLE STREET, MILFORD MA 01757
Amol Chaubal officer: SVP and Chief Financial Office 113 HARTWELL AVE, C/O QUANTERIX CORPORATION, LEXINGTON MA 02421
Jianqing Bennett officer: SVP TA Instruments Division 34 MAPLE STREET, MILFORD MA 01757
Joann A Reed director C/O AMERICAN TOWER CORP, 116 HUNTINGTON AVENUE, BOSTON MA 02116
Belinda Hyde officer: SVP, Global Human Resources 13320 BALLANTYNE CORPORATE PLACE, CHARLOTTE NC 28277