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Domino's Pizza Enterprises (ASX:DMP) Altman Z-Score : 2.02 (As of Dec. 13, 2024)


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What is Domino's Pizza Enterprises Altman Z-Score?

The Altman Z-Score is a model designed to predict the likelihood of a company going bankrupt within the next two years. Created by American finance professor Edward Altman in 1968, the model is specifically designed for publicly traded manufacturing companies with assets greater than $1 million.

Warning Sign:

Altman Z-score of 2.07 is in the grey area. This implies that the company is under some kind of financial stress. If it is below 1.8, the company may face bankruptcy risk.

Domino's Pizza Enterprises has a Altman Z-Score of 2.02, indicating it is in Grey Zones. This implies that Domino's Pizza Enterprises is in some kind of financial stress. If it is below 1.81, the company may face bankrupcy risk.

The zones of discrimination were as such:

When Altman Z-Score <= 1.8, it is in Distress Zones.
When Altman Z-Score >= 3, it is in Safe Zones.
When Altman Z-Score is between 1.8 and 3, it is in Grey Zones.

The historical rank and industry rank for Domino's Pizza Enterprises's Altman Z-Score or its related term are showing as below:

ASX:DMP' s Altman Z-Score Range Over the Past 10 Years
Min: 2.07   Med: 3.81   Max: 7.45
Current: 2.07

During the past 13 years, Domino's Pizza Enterprises's highest Altman Z-Score was 7.45. The lowest was 2.07. And the median was 3.81.


Domino's Pizza Enterprises Altman Z-Score Historical Data

The historical data trend for Domino's Pizza Enterprises's Altman Z-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Domino's Pizza Enterprises Altman Z-Score Chart

Domino's Pizza Enterprises Annual Data
Trend Jun15 Jun16 Jun17 Jun18 Jun19 Jun20 Jun21 Jun22 Jun23 Jun24
Altman Z-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only 2.89 4.65 3.09 2.11 2.18

Domino's Pizza Enterprises Semi-Annual Data
Dec14 Jun15 Dec15 Jun16 Dec16 Jun17 Dec17 Jun18 Dec18 Jun19 Dec19 Jun20 Dec20 Jun21 Dec21 Jun22 Dec22 Jun23 Dec23 Jun24
Altman Z-Score Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 3.09 - 2.11 - 2.18

Competitive Comparison of Domino's Pizza Enterprises's Altman Z-Score

For the Restaurants subindustry, Domino's Pizza Enterprises's Altman Z-Score, along with its competitors' market caps and Altman Z-Score 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.


Domino's Pizza Enterprises's Altman Z-Score Distribution in the Restaurants Industry

For the Restaurants industry and Consumer Cyclical sector, Domino's Pizza Enterprises's Altman Z-Score distribution charts can be found below:

* The bar in red indicates where Domino's Pizza Enterprises's Altman Z-Score falls into.



Domino's Pizza Enterprises Altman Z-Score Calculation

Altman Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

Domino's Pizza Enterprises's Altman Z-Score for today is calculated with this formula:

Z=1.2*X1+1.4*X2+3.3*X3+0.6*X4+1.0*X5
=1.2*-0.0323+1.4*0.0865+3.3*0.0605+0.6*1.3735+1.0*0.9141
=2.02

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency. GuruFocus does not calculate Altman Z-Score when X4 or X5 value is 0.

Trailing Twelve Months (TTM) ended in Jun. 2024:
Total Assets was A$2,593 Mil.
Total Current Assets was A$461 Mil.
Total Current Liabilities was A$545 Mil.
Retained Earnings was A$224 Mil.
Pre-Tax Income was A$128 Mil.
Interest Expense was A$-28 Mil.
Revenue was A$2,370 Mil.
Market Cap (Today) was A$2,724 Mil.
Total Liabilities was A$1,983 Mil.

* Note that for stock reported semi-annually or annually, GuruFocus uses latest annual data as the TTM data.

X1=Working Capital/Total Assets
=(Total Current Assets - Total Current Liabilities)/Total Assets
=(460.978 - 544.768)/2592.789
=-0.0323

X2=Retained Earnings/Total Assets
=224.309/2592.789
=0.0865

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(128.423 - -28.392)/2592.789
=0.0605

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=2724.030/1983.241
=1.3735

X5=Revenue/Total Assets
=2370.008/2592.789
=0.9141

The zones of discrimination were as such:

Distress Zones - 1.81 < Grey Zones < 2.99 - Safe Zones

Domino's Pizza Enterprises has a Altman Z-Score of 2.02 indicating it is in Grey Zones.

Study by Altman found that companies that are in Distress Zone have more than 80% of chances of bankruptcy in two years.


Domino's Pizza Enterprises  (ASX:DMP) Altman Z-Score Explanation

X1: The Working Capital/Total Assets (WC/TA) ratio is a measure of the net liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily, a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets. Altman found this one proved to be the most valuable liquidity ratio comparing with the current ratio and the quick ratio. This is however the least significant of the five factors.

X2: Retained Earnings/Total Assets: the RE/TA ratio measures the leverage of a firm. Retained earnings is the account which reports the total amount of reinvested earnings and/or losses of a firm over its entire life. Those firms with high RE, relative to TA, have financed their assets through retention of profits and have not utilized as much debt.

X3, Earnings Before Interest and Taxes/Total Assets (EBIT/TA): This ratio is a measure of the true productivity of the firm's assets, independent of any tax or leverage factors. Since a firm's ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure. This ratio continually outperforms other profitability measures, including cash flow.

X4, Market Value of Equity/Book Value of Total Liabilities (MVE/TL): The measure shows how much the firm's assets can decline in value (measured by market value of equity plus debt) before the liabilities exceed the assets and the firm becomes insolvent.

X5, Revenue/Total Assets (S/TA): The capital-turnover ratio is a standard financial ratio illustrating the sales generating ability of the firm's assets.

Read more about Altman Z-Score and the original research.


Be Aware

Altman Z-Score does not apply to financial companies.


Domino's Pizza Enterprises Altman Z-Score Related Terms

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Domino's Pizza Enterprises Business Description

Traded in Other Exchanges
Address
485 Kingsford Smith Drive, Level 1, KSD1, Hamilton, Brisbane, QLD, AUS, 4007
Domino's Pizza Enterprises operates fast-food pizza outlets and franchise service. The company holds the exclusive master franchise rights for the Domino's brand and network in Australia, New Zealand, Japan, Singapore, Malaysia, Taiwan, Germany, France, Belgium, Luxembourg, Cambodia, and the Netherlands. The Domino's brand is owned by NYSE-listed Domino's Pizza Inc.

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