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General Electric Co Altman Z-Score

: 1.38 (As of Today)
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Warning Sign:

Altman Z-score of 1.39 is in distress zone. This implies bankruptcy possibility in the next two years.

General Electric Co has a Altman Z-Score of 1.38, indicating it is in Distress Zones. This implies bankrupcy possibility in the next two years.

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 General Electric Co's Altman Z-Score or its related term are showing as below:

GE' s Altman Z-Score Range Over the Past 10 Years
Min: 0.8   Med: 1.32   Max: 3.56
Current: 1.39

During the past 13 years, General Electric Co's highest Altman Z-Score was 3.56. The lowest was 0.80. And the median was 1.32.


General Electric Co Altman Z-Score Historical Data

The historical data trend for General Electric Co'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.

* Premium members only.

General Electric Co Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Altman Z-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.16 0.92 1.20 1.35 1.42

General Electric Co Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
Altman Z-Score 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 Premium Member Only Premium Member Only Premium Member Only 1.41 1.44 1.42 1.42 1.32

Competitive Comparison

For the Specialty Industrial Machinery subindustry, General Electric Co'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.

   

General Electric Co Altman Z-Score Distribution

For the Industrial Products industry and Industrials sector, General Electric Co's Altman Z-Score distribution charts can be found below:

* The bar in red indicates where General Electric Co's Altman Z-Score falls into.



General Electric Co 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.

General Electric Co'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*0.0365+1.4*0.4472+3.3*-0.0099+0.6*0.5729+1.0*0.4014
=1.38

* 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. 2022:
Total Assets was $185,540 Mil.
Total Current Assets was $60,656 Mil.
Total Current Liabilities was $53,883 Mil.
Retained Earnings was $82,981 Mil.
Pre-Tax Income was -244 + -525 + -3467 + 584 = $-3,652 Mil.
Interest Expense was -394 + -538 + -426 + -462 = $-1,820 Mil.
Revenue was 18645 + 17039 + 20370 + 18429 = $74,483 Mil.
Market Cap (Today) was $85,705 Mil.
Total Liabilities was $149,598 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
=(60656 - 53883)/185540
=0.0365

X2=Retained Earnings/Total Assets
=82981/185540
=0.4472

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(-3652 - -1820)/185540
=-0.0099

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=85705.274/149598
=0.5729

X5=Revenue/Total Assets
=74483/185540
=0.4014

The zones of discrimination were as such:

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

General Electric Co has a Altman Z-Score of 1.38 indicating it is in Distress Zones.

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


General Electric Co  (NYSE:GE) 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.


General Electric Co Altman Z-Score Related Terms

Thank you for viewing the detailed overview of General Electric Co's Altman Z-Score provided by GuruFocus.com. Please click on the following links to see related term pages.


General Electric Co Business Description

General Electric Co logo
Address
5 Necco Street, Boston, MA, USA, 02210
GE was formed through the combination of two companies in 1892, including one with historical ties to American inventor Thomas Edison. Today, GE is a global leader in air travel, precision health, and in the energy transition. The company is known for its differentiated technology and its massive industrial installed base of equipment sprawled throughout the world. That installed base most notably includes aerospace engines, gas and steam turbines, onshore and offshore wind turbines, as well as medical diagnostic and mobile equipment. GE earns most of its profits on the service revenue of that equipment, which is generally higher-margin. The company is led by former Danaher alum Larry Culp who is leading a multi-year turnaround of the storied conglomerate based on Lean principles.
Executives
Mihaljevic Tomislav director 5 NECCO ST BOSTON MA 02210
Goren Isabella D director C/O LYONDELLBASELL INDUSTRIES N V DELFTSEPLEIN 27E ROTTERDAM P7 3013AA
Angel Stephen F director 39 OLD RIDGEBURY ROAD DANBURY CT 06810-5113
Dybeck Happe Carolina officer: Senior Vice President 5 NECCO STREET BOSTON MA 02210
Slattery John S. officer: Senior Vice President 5 NECCO STREET BOSTON MA 02210
Arduini Peter J officer: Senior Vice President 311 ENTERPRISE DRIVE PLAINSBORO NJ 08536
Cox L Kevin officer: Senior Vice President THE PEPSI BOTTLING GROUP, INC. ONE PEPSI WAY SOMERS NY 10589
Timko Thomas S officer: Vice President 300 RENAISSANCE CENTER M/C: 482-C25-A36 DETROIT MI 48265-3000
Stokes Russell officer: Senior Vice President 5 NECCO STREET BOSTON MA 02210
Pecresse Jerome officer: Senior Vice President 5 NECCO STREET BOSTON MA 02210
Murphy Kieran Pius officer: Senior Vice President THE GROVE CENTRE,WHITE LION ROAD LITTLE CHALFONT X0 HP7 9LL
Strazik Scott officer: Senior Vice President 5 NECCO STREET N/A BOSTON MA 02210
Horton Thomas W director 4333 AMON CARTER BLVD. FORTH WORTH TX 76155
Dsouza Francisco director 500 GLENPOINTE CENTRE W TEANECK NJ 07666
Tisch James S director 667 MADISON AVE NEW YORK NY 10021

General Electric Co Headlines

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