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IHS Markit Altman Z-Score

: 4.88 (As of Today)
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Good Sign:

Altman Z-score of 4.88 is strong.

IHS Markit has a Altman Z-Score of 4.88, 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 IHS Markit's Altman Z-Score or its related term are showing as below:

NYSE:INFO' s Altman Z-Score Range Over the Past 10 Years
Min: 0.86   Med: 3.04   Max: 6.8
Current: 4.88

0.86
6.8

During the past 13 years, IHS Markit's highest Altman Z-Score was 6.80. The lowest was 0.86. And the median was 3.04.


IHS Markit Altman Z-Score Historical Data

The historical data trend for IHS Markit'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.

IHS Markit Annual Data
Trend Nov11 Nov12 Nov13 Nov14 Nov15 Nov16 Nov17 Nov18 Nov19 Nov20
Altman Z-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 1.93 2.12 2.11 2.98 3.88

IHS Markit Quarterly Data
Nov16 Feb17 May17 Aug17 Nov17 Feb18 May18 Aug18 Nov18 Feb19 May19 Aug19 Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21
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 3.29 3.88 3.44 4.08 4.67

Competitive Comparison

For the Consulting Services subindustry, IHS Markit'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.

   

IHS Markit Altman Z-Score Distribution

For the Business Services industry and Industrials sector, IHS Markit's Altman Z-Score distribution charts can be found below:

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



IHS Markit 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.

IHS Markit'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*0.037+1.4*0.2467+3.3*0.059+0.6*6.6918+1.0*0.2782
=4.88

* 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 Aug. 2021:
Total Assets was $16,497 Mil.
Total Current Assets was $2,659 Mil.
Total Current Liabilities was $2,049 Mil.
Retained Earnings was $4,069 Mil.
Pre-Tax Income was 236.1 + 220.2 + 178 + 115.6 = $750 Mil.
Interest Expense was -54.8 + -55.4 + -55.5 + -57.7 = $-223 Mil.
Revenue was 1180.5 + 1181.4 + 1119.9 + 1107.2 = $4,589 Mil.
Market Cap (Today) was $50,780 Mil.
Total Liabilities was $7,589 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
=(2659 - 2048.5)/16496.5
=0.037

X2=Retained Earnings/Total Assets
=4069/16496.5
=0.2467

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(749.9 - -223.4)/16496.5
=0.059

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=50780.484/7588.5
=6.6918

X5=Revenue/Total Assets
=4589/16496.5
=0.2782

The zones of discrimination were as such:

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

IHS Markit has a Altman Z-Score of 4.88 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.


IHS Markit  (NYSE:INFO) 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.


IHS Markit Altman Z-Score Related Terms

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


IHS Markit Business Description

IHS Markit logo
Industry
Industrials » Business Services NAICS : 561499 SIC : 7389
Traded in Other Exchanges
Address
25 Ropemaker Street, 4th Floor, Ropemaker Place, London, GBR, EC2Y 9LY
IHS Markit is a leading provider of data and analytics to corporate and sovereign clients across a wide variety of industries. Financial markets accounted for 42% of fiscal 2020 revenue, transportation 27%, resources (energy and chemicals) 20%, and CMS (consolidated markets) 11%. Approximately 60% of fiscal 2020 revenue came from the United States. IHS Markit has approximately 16,000 employees worldwide. About 74% of fiscal 2020 revenue was recurring and fixed, 14% recurring and variable, and 12% non-recurring. S&P Global has offered to acquire IHS Markit, with holders of the target firm set to receive 0.2838 shares of the combined entity (a little less than one third of the total), in a deal valued at $44 billion upon announcement.

IHS Markit Headlines

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