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Change Healthcare Altman Z-Score

: 1.12 (As of Today)
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Warning Sign:

Altman Z-score of 1.12 is in distress zone. This implies bankruptcy possibility in the next two years.

Change Healthcare has a Altman Z-Score of 1.12, 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 Change Healthcare's Altman Z-Score or its related term are showing as below:

CHNG' s Altman Z-Score Range Over the Past 10 Years
Min: -0.15   Med: 0.82   Max: 0.98
Current: 1.12

During the past 6 years, Change Healthcare's highest Altman Z-Score was 0.98. The lowest was -0.15. And the median was 0.82.


Change Healthcare Altman Z-Score Historical Data

The historical data trend for Change Healthcare'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.

Change Healthcare Annual Data
Trend Mar17 Mar18 Mar19 Mar20 Mar21 Mar22
Altman Z-Score
Premium Member Only - - -0.15 0.79 0.88

Change Healthcare Quarterly Data
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 0.88 0.84 0.85 0.88 0.98

Competitive Comparison

For the Health Information Services subindustry, Change Healthcare'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.

   

Change Healthcare Altman Z-Score Distribution

For the Healthcare Providers & Services industry and Healthcare sector, Change Healthcare's Altman Z-Score distribution charts can be found below:

* The bar in red indicates where Change Healthcare's Altman Z-Score falls into.



Change Healthcare 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.

Change Healthcare'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*0.0222+1.4*-0.1166+3.3*0.0109+0.6*1.4222+1.0*0.3629
=1.12

* 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 $9,637 Mil.
Total Current Assets was $1,146 Mil.
Total Current Liabilities was $933 Mil.
Retained Earnings was $-1,123 Mil.
Pre-Tax Income was -32.479 + -6.208 + -34.587 + -53.153 = $-126 Mil.
Interest Expense was -56.87 + -56.96 + -58.433 + -59.466 = $-232 Mil.
Revenue was 884.469 + 920.131 + 866.065 + 826.764 = $3,497 Mil.
Market Cap (Today) was $9,025 Mil.
Total Liabilities was $6,346 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
=(1146.401 - 932.805)/9636.981
=0.0222

X2=Retained Earnings/Total Assets
=-1123.249/9636.981
=-0.1166

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(-126.427 - -231.729)/9636.981
=0.0109

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=9025.201/6346.095
=1.4222

X5=Revenue/Total Assets
=3497.429/9636.981
=0.3629

The zones of discrimination were as such:

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

Change Healthcare has a Altman Z-Score of 1.12 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.


Change Healthcare  (NAS:CHNG) 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.


Change Healthcare Altman Z-Score Related Terms

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


Change Healthcare Business Description

Change Healthcare logo
Traded in Other Exchanges
Address
424 Church Street, Suite 1400, Nashville, TN, USA, 37219
Change Healthcare is a spin-off of various healthcare processing and consulting services acquired by McKesson over numerous years. Recently, these processing assets were contributed to a joint venture and in June 2019 public shares were issued with McKesson retaining the majority interest. As of the end of the March 2020 quarter, McKesson distributed all its interest in the public processor. Core services consist of insurance (healthcare) claim clearinghouse for healthcare payers in addition to administrative and consulting services to assist healthcare providers improve reimbursement coding, billing, and collections.
Executives
Byers Tracy officer: SVP and GM, Enterprise Imaging C/O CHANGE HEALTHCARE INC. 424 CHURCH STREET, SUITE 1400 NASHVILLE TN 37219
Domenici Nella director C/O ALLIANCEBERNSTEIN 1345 AVENUE OF THE AMERICAS NEW YORK NY 10105
Martin Steven B. officer: EVP, Enterprise Technology 3055 LEBANON PIKE SUITE 1000 NASHVILLE TN 37214
Mckenzie Diana director METLIFE 200 PARK AVENUE NEW YORK NY 10166
Blackstone Family Investment Partnership Vi L.p. 10 percent owner C/O THE BLACKSTONE GROUP 345 PARK AVENUE NEW YORK NY 10154
O'reilly Roderick H. officer: See Remarks C/O CHANGE HEALTHCARE INC. 3055 LEBANON PIKE, SUITE 1000 NASHVILLE TN 37214
Bcp Vi Side-by-side Gp L.l.c. 10 percent owner C/O THE BLACKSTONE GROUP 345 PARK AVENUE NEW YORK NY 10154
Mcenery Thomas officer: EVP & Chief Marketing Officer
Simpkins Neil P director C/O BLACKSTONE GROUP 345 PARK AVENUE NEW YORK NY 10154
Whitley-taylor Linda officer: EVP & Chief People Officer AMERIGROUP CORPORATION 4425 CORPORATION LANE VIRGINIA BEACH VA 23462
Roe Phillip W. director 20 BURTON HILLS BOULEVARD SUITE 100 NASHVILLE TN 37215
Joshi Kriten officer: See Remarks C/O CHANGE HEALTHCARE INC. 3055 LEBANON PIKE, SUITE 1000 NASHVILLE TN 37214
Rareshide Paul officer: SVP, Corporate Controller C/O CHANGE HEALTHCARE INC. 3055 LEBANON PIKE, SUITE 1000 NASHVILLE TN 37214
Laur Thomas officer: See Remarks C/O CHANGE HEALTHCARE INC. 3055 LEBANON PIKE, SUITE 1000 NASHVILLE TN 37214
Calhoun August officer: See Remarks C/O CHANGE HEALTHCARE INC. 3055 LEBANON PIKE, SUITE 1000 NASHVILLE TN 37214

Change Healthcare Headlines

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