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Reata Pharmaceuticals (Reata Pharmaceuticals) Altman Z-Score : 5.73 (As of May. 11, 2024)


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What is Reata Pharmaceuticals 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.

Good Sign:

Altman Z-score of 5.73 is strong.

Reata Pharmaceuticals has a Altman Z-Score of 5.73, indicating it is in Safe Zones. This implies the Altman Z-Score is strong.

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 Reata Pharmaceuticals's Altman Z-Score or its related term are showing as below:

RETA' s Altman Z-Score Range Over the Past 10 Years
Min: -5.37   Med: -1.33   Max: 7.64
Current: 5.73

During the past 10 years, Reata Pharmaceuticals's highest Altman Z-Score was 7.64. The lowest was -5.37. And the median was -1.33.


Reata Pharmaceuticals Altman Z-Score Historical Data

The historical data trend for Reata Pharmaceuticals'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.

Reata Pharmaceuticals Altman Z-Score Chart

Reata Pharmaceuticals Annual Data
Trend Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22
Altman Z-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only 1.77 7.64 4.66 -1.54 -3.76

Reata Pharmaceuticals Quarterly Data
Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23
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 -2.41 -3.30 -3.76 -3.22 1.82

Competitive Comparison of Reata Pharmaceuticals's Altman Z-Score

For the Biotechnology subindustry, Reata Pharmaceuticals'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.


Reata Pharmaceuticals's Altman Z-Score Distribution in the Biotechnology Industry

For the Biotechnology industry and Healthcare sector, Reata Pharmaceuticals's Altman Z-Score distribution charts can be found below:

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



Reata Pharmaceuticals 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.

Reata Pharmaceuticals'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*0.5507+1.4*-2.966+3.3*-0.0936+0.6*15.8115+1.0*0.0467
=5.73

* 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. 2023:
Total Assets was $502.59 Mil.
Total Current Assets was $401.85 Mil.
Total Current Liabilities was $125.09 Mil.
Retained Earnings was $-1,490.65 Mil.
Pre-Tax Income was 192.998 + -116.117 + -85.557 + -79.002 = $-87.68 Mil.
Interest Expense was -7.973 + -11.017 + -10.959 + -10.664 = $-40.61 Mil.
Revenue was 22.746 + 0.195 + 0 + 0.54 = $23.48 Mil.
Market Cap (Today) was $6,566.44 Mil.
Total Liabilities was $415.30 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
=(401.849 - 125.093)/502.587
=0.5507

X2=Retained Earnings/Total Assets
=-1490.651/502.587
=-2.966

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(-87.678 - -40.613)/502.587
=-0.0936

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=6566.444/415.296
=15.8115

X5=Revenue/Total Assets
=23.481/502.587
=0.0467

The zones of discrimination were as such:

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

Reata Pharmaceuticals has a Altman Z-Score of 5.73 indicating it is in Safe Zones.

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


Reata Pharmaceuticals  (NAS:RETA) 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.


Reata Pharmaceuticals Altman Z-Score Related Terms

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Reata Pharmaceuticals (Reata Pharmaceuticals) Business Description

Traded in Other Exchanges
N/A
Address
5320 Legacy Drive, Plano, TX, USA, 75024
Reata Pharmaceuticals Inc is a clinical-stage biopharmaceutical company focused on identifying, developing, and commercializing therapeutics to address serious and life-threatening diseases by targeting molecular pathways. The company's product in the pipeline include bardoxolone methyl; Omaveloxolone and others.
Executives
Steven Ryder director 234 CHURCH STREET, SUITE 1020, NEW HAVEN CT 06510
Antal Rohit Desai director, 10 percent owner C/O PROCEPT BIOROBOTICS CORPORATION, 900 ISLAND DRIVE, REDWOOD CITY CA 94065
Rajiv Patni officer: EVP, Chief R&D Officer C/O OCERA THERAPEUTICS, INC., 525 UNIVERSITY AVENUE, SUITE 610, PALO ALTO CA 94301
Bhaskar Anand officer: SVP, Chief Accounting Officer 5320 LEGACY DRIVE, PLANO TX 75024
Manmeet Singh Soni officer: COO, CFO and President C/O PHARMACYCLICS, INC., 995 EAST ARQUES AVE, SUNNYVALE CA 94085
Martin Edwards director 15 NEW ENGLAND EXECUTIVE PARK, BURLINGTON MA 01803
Dawn Carter Bir officer: Chief Commercial Officer C/O REATA PHARMACEUTICALS, INC., 2801 GATEWAY DRIVE, SUITE 150, IRVING TX 75063
Christy J. Oliger director 85 WELLS AVENUE, SUITE 210, NEWTON MA 02459
Andrea Loewen officer: SVP, Global Regulatory Affairs C/O VITAL THERAPIES, INC., 15010 AVENUE OF SCIENCE, SUITE 200, SAN DIEGO CA 92128
Shamim Ruff director 215 FIRST STREET, SUITE 415, CAMBRIDGE MA 02142
Mcclellan William D. Jr. director C/O APOLLO ENDOSURGERY, INC., 1120 S., CAPITAL OF TEXAS HWY, BLDG. 1, SUITE 300, AUSTIN TX 78746
Michael D Wortley officer: See Remarks 5320 LEGACY DRIVE, PLANO TX 75024
Meyer Colin John officer: See Remarks C/O REATA PHARMACEUTICALS, INC., 2801 GATEWAY DR. SUITE 150, IRVING TX 75063
Biogen Inc. other: See footnotes 225 BINNEY STREET, CAMBRIDGE MA 02142
Samina Khan officer: SVP, Chief Medical Officer 5320 LEGACY DRIVE, PLANO TX 75024

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