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Iridium Communications (Iridium Communications) Altman Z-Score

: 1.52 (As of Today)
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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 1.5 is in distress zone. This implies bankruptcy possibility in the next two years.

Iridium Communications has a Altman Z-Score of 1.52, 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 Iridium Communications's Altman Z-Score or its related term are showing as below:

IRDM' s Altman Z-Score Range Over the Past 10 Years
Min: 0.69   Med: 1.05   Max: 3
Current: 1.5

During the past 13 years, Iridium Communications's highest Altman Z-Score was 3.00. The lowest was 0.69. And the median was 1.05.


Iridium Communications Altman Z-Score Historical Data

The historical data trend for Iridium Communications'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.

Iridium Communications Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Altman Z-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only 1.16 2.01 2.14 2.50 2.05

Iridium Communications Quarterly Data
Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24
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 3.00 2.93 2.19 2.05 1.42

Competitive Comparison

For the Telecom Services subindustry, Iridium Communications'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.


Iridium Communications Altman Z-Score Distribution

For the Telecommunication Services industry and Communication Services sector, Iridium Communications's Altman Z-Score distribution charts can be found below:

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



Iridium Communications 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.

Iridium Communications'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*0.0964+1.4*-0.0937+3.3*0.041+0.6*1.8541+1.0*0.2885
=1.52

* 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 Mar. 2024:
Total Assets was $2,736.0 Mil.
Total Current Assets was $376.8 Mil.
Total Current Liabilities was $113.0 Mil.
Retained Earnings was $-256.3 Mil.
Pre-Tax Income was 29.151 + 30.213 + -6.162 + -34.275 = $18.9 Mil.
Interest Expense was -20.663 + -19.114 + -34.66 + -18.723 = $-93.2 Mil.
Revenue was 203.853 + 194.74 + 197.602 + 193.108 = $789.3 Mil.
Market Cap (Today) was $3,489.9 Mil.
Total Liabilities was $1,882.3 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
=(376.792 - 113.001)/2735.958
=0.0964

X2=Retained Earnings/Total Assets
=-256.319/2735.958
=-0.0937

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(18.927 - -93.16)/2735.958
=0.041

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=3489.856/1882.273
=1.8541

X5=Revenue/Total Assets
=789.303/2735.958
=0.2885

The zones of discrimination were as such:

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

Iridium Communications has a Altman Z-Score of 1.52 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.


Iridium Communications  (NAS:IRDM) 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.


Iridium Communications Altman Z-Score Related Terms

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Iridium Communications (Iridium Communications) Business Description

Traded in Other Exchanges
Address
1750 Tysons Boulevard, Suite 1400, McLean, VA, USA, 22102
Iridium Communications Inc offers voice and data communications services and products to businesses, U.S. and international government agencies, and other customers on a global basis. The company is a provider of mobile voice and data communications services through a constellation of low earth-orbiting satellites. Reaching across land, sea, and air, including the polar regions, Iridium's solutions are ideally suited for industries such as maritime, aviation, government/military, emergency/humanitarian services, mining, forestry, oil and gas, heavy equipment, transportation, and utilities. Iridium also provides service to subscribers from the U.S. Department of Defense, as well as other civil and government agencies around the world.
Executives
Matthew J Desch director, officer: Chief Executive Officer C/O SAIC, 10260 CAMPUS POINT DR M/S F3, SAN DIEGO CA 92121
Jacqueline E Yeaney director 2002 SUMMIT BOULEVARD, SUITE 100, ATLANTA GA 30319
Bryan J. Hartin officer: EVP-Sales and Marketing C/O IRIDIUM COMMUNICATIONS INC., 1750 TYSONS BOULEVARD, SUITE 1400, MCLEAN VA 22102
Robert H Niehaus director, officer: Senior Vice President 4747 GAILLARDIA PARKWAY, OKLAHOMA CITY OK 73142
Suzanne E. Mcbride officer: Chief Operations Officer C/O IRIDIUM COMMUNICATIONS INC., 1750 TYSONS BOULEVARD, SUITE 1400, MCLEAN VA 22102
Barry West director NEXTEL, 2001 EDMUND HALLEY DR, RESTON VA 20191
Scott Scheimreif officer: EVP-Government Programs C/O IRIDIUM COMMUNICATIONS INC., 1750 TYSONS BOULEVARD, SUITE 1400, MCLEAN VA 22102
Thomas C Canfield director C/O SPIRIT AIRLINES, INC., 2800 EXECUTIVE WAY, MIRAMAR FL 33025
Kathleen A. Morgan officer: Chief Legal Officer C/O IRIDIUM COMMUNICATIONS INC., 1750 TYSONS BOULEVARD SUITE 1400, MCLEAN VA 22102
Thomas Fitzpatrick officer: Chief Financial Officer C/O CENTENNIAL COMMUNICATIONS CORP, 3349 RTE 138, WALL NJ 07719
Henrik O. Schliemann director C/O IRIDIUM COMMUNICATIONS INC., 1750 TYSONS BOULEVARD, SUITE 1400, MCLEAN VA 22102
Timothy Kapalka officer: VP Iridium Satellite LLC C/O IRIDIUM COMMUNICATIONS INC., 1750 TYSONS BOULEVARD, MCLEAN VA 22102
Parker William Rush director 5525 LBJ FREEWAY, DALLAS TX 75240
A B Krongard director C/O UNDER ARMOUR, INC., 1020 HULL STREET, BALTIMORE MD 21230
Kay Sears director C/O IRIDIUM COMMUNICATIONS INC., 1750 TYSONS BOULEVARD, SUITE 1400, MCLEAN VA 22102