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Edwards Lifesciences Altman Z-Score

: 18.22 (As of Today)
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Good Sign:

Altman Z-score of 17.96 is strong.

Edwards Lifesciences has a Altman Z-Score of 18.22, 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 Edwards Lifesciences's Altman Z-Score or its related term are showing as below:

EW' s Altman Z-Score Range Over the Past 10 Years
Min: 0.96   Med: 8.63   Max: 20.77
Current: 17.96

During the past 13 years, Edwards Lifesciences's highest Altman Z-Score was 20.77. The lowest was 0.96. And the median was 8.63.


Edwards Lifesciences Altman Z-Score Historical Data

The historical data trend for Edwards Lifesciences'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.

Edwards Lifesciences 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 7.17 10.94 14.97 15.10 20.77

Edwards Lifesciences 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 18.03 18.85 20.77 19.76 17.00

Competitive Comparison

For the Medical Devices subindustry, Edwards Lifesciences'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.

   

Edwards Lifesciences Altman Z-Score Distribution

For the Medical Devices & Instruments industry and Healthcare sector, Edwards Lifesciences's Altman Z-Score distribution charts can be found below:

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



Edwards Lifesciences 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.

Edwards Lifesciences'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*0.2723+1.4*0.8128+3.3*0.1981+0.6*25.772+1.0*0.6356
=18.22

* 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 $8,425 Mil.
Total Current Assets was $3,263 Mil.
Total Current Liabilities was $969 Mil.
Retained Earnings was $6,848 Mil.
Pre-Tax Income was 464.7 + 436.1 + 376.3 + 390.9 = $1,668 Mil.
Interest Expense was 0 + 0 + 0 + -0.8 = $-1 Mil.
Revenue was 1373.9 + 1341.2 + 1329.7 + 1310.2 = $5,355 Mil.
Market Cap (Today) was $63,953 Mil.
Total Liabilities was $2,482 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
=(3263.1 - 969.1)/8425.1
=0.2723

X2=Retained Earnings/Total Assets
=6848.1/8425.1
=0.8128

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(1668 - -0.8)/8425.1
=0.1981

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=63953.327/2481.5
=25.772

X5=Revenue/Total Assets
=5355/8425.1
=0.6356

The zones of discrimination were as such:

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

Edwards Lifesciences has a Altman Z-Score of 18.22 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.


Edwards Lifesciences  (NYSE:EW) 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.


Edwards Lifesciences Altman Z-Score Related Terms

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


Edwards Lifesciences Business Description

Edwards Lifesciences logo
Address
One Edwards Way, Irvine, CA, USA, 92614
Spun off from Baxter International in 2000, Edwards Lifesciences designs, manufactures, and markets a range of medical devices and equipment for advanced stages of structural heart disease. Its key products include surgical tissue heart valves, transcatheter valve technologies, surgical clips, catheters, and monitoring systems used to measure a patient's heart function during surgery. The firm derives about 55% of its total sales from outside the U.S.
Executives
Laviolette Paul A director ONE BOSTON PLACE 201 WASHINGTON STREET, SUITE 3900 BOSTON MA 02108
Sequeira Ramona director ONE EDWARDS WAY IRVINE CA 92614
Chopra Daveen officer: CVP, Surgical Structural Heart C/O EDWARDS LIFESCIENCES CORPORATION ONE EDWARDS WAY IRVINE CA 92618
Lemercier Jean-luc M officer: CVP, EMEA, Canada, Latin Amer C/O ONE EDWARDS WAY IRVINE CA 92614
Ullem Scott B. officer: CVP, CFO C/O EDWARDS LIFESCIENCES CORPORATION ONE EDWARDS WAY IRVINE CA 92614
Bobo Donald E Jr officer: CVP,Strategy/Corp Development C/O EDWARDS LIFESCIENCES ONE EDWARDS WAY IRVINE CA 92614
Szyman Catherine M. officer: CVP, Critical Care C/O EDWARDS LIFESCIENCES CORPORATION ONE EDWARDS WAY IRVINE CA 92614
Sellers Robert W.a. officer: VP, Corp. Controller (Principa ONE EDWARDS WAY IRVINE CA 92614
Stone Heisz Leslie director C/O PUBLIC STORAGE 701 WESTERN AVENUE GLENDALE CA 91201
Loranger Steven R director XYLEM. INC. 1133 WESTCHESTER AVENUE WHITE PLAINS NY 10604
Zovighian Bernard J officer: CVP, Surgical Heart Valves C/O EDWARDS LIFESCIENCES CORPORATION ONE EDWARDS WAY IRVINE CA 92614
Marsh Martha H. director 9769 WEXFORD CIRCLE GRANITE BAY CA 95746
Gallahue Kieran director PO BOX 684369 PARK CITY UT 84068
Valeriani Nicholas J director C/O EDWARDS LIFESCIENCES CORPORATION ONE EDWARDS WAY IRVINE CA 92614
Mccauley Christine Z officer: CVP, Human Resources ONE EDWARDS WAY IRVINE CA 92614

Edwards Lifesciences Headlines

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