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Freehold Royalties (STU:1FH) Altman Z-Score : 4.42 (As of Dec. 13, 2024)


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What is Freehold Royalties 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 4.35 is strong.

Freehold Royalties has a Altman Z-Score of 4.42, 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 Freehold Royalties's Altman Z-Score or its related term are showing as below:

STU:1FH' s Altman Z-Score Range Over the Past 10 Years
Min: 0.83   Med: 5.08   Max: 12.76
Current: 4.35

During the past 13 years, Freehold Royalties's highest Altman Z-Score was 12.76. The lowest was 0.83. And the median was 5.08.


Freehold Royalties Altman Z-Score Historical Data

The historical data trend for Freehold Royalties'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.

Freehold Royalties Altman Z-Score Chart

Freehold Royalties 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 3.21 1.23 5.61 6.15 6.48

Freehold Royalties Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
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 6.55 6.48 4.49 4.32 4.68

Competitive Comparison of Freehold Royalties's Altman Z-Score

For the Oil & Gas E&P subindustry, Freehold Royalties'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.


Freehold Royalties's Altman Z-Score Distribution in the Oil & Gas Industry

For the Oil & Gas industry and Energy sector, Freehold Royalties's Altman Z-Score distribution charts can be found below:

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



Freehold Royalties 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.

Freehold Royalties'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*0.0158+1.4*-0.5119+3.3*0.1613+0.6*7.1853+1.0*0.2693
=4.42

* 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 Sep. 2024:
Total Assets was €785.7 Mil.
Total Current Assets was €31.5 Mil.
Total Current Liabilities was €19.1 Mil.
Retained Earnings was €-402.2 Mil.
Pre-Tax Income was 22.488 + 34.628 + 29.47 + 30.806 = €117.4 Mil.
Interest Expense was -2.42 + -2.706 + -2.552 + -1.673 = €-9.4 Mil.
Revenue was 49.137 + 57.259 + 50.481 + 54.723 = €211.6 Mil.
Market Cap (Today) was €1,321.8 Mil.
Total Liabilities was €184.0 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
=(31.489 - 19.083)/785.672
=0.0158

X2=Retained Earnings/Total Assets
=-402.224/785.672
=-0.5119

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(117.392 - -9.351)/785.672
=0.1613

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=1321.757/183.953
=7.1853

X5=Revenue/Total Assets
=211.6/785.672
=0.2693

The zones of discrimination were as such:

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

Freehold Royalties has a Altman Z-Score of 4.42 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.


Freehold Royalties  (STU:1FH) 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.


Freehold Royalties Altman Z-Score Related Terms

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Freehold Royalties Business Description

Traded in Other Exchanges
Address
517 - 10 Avenue SW, Suite 1000, Calgary, AB, CAN, T2R 0A8
Freehold Royalties Ltd is in acquiring and managing Oil and Gas royalties. It operates in two segments: Canada, which includes exploration and evaluation assets and the petroleum and natural gas interests in Western Canada; and the United States, which includes petroleum and natural gas interests held in the Permian (Midland and Delaware), Eagle Ford, Haynesville, and Bakken basins primarily located in the states of Texas, Louisiana, and North Dakota. The maximum revenue is generated from the Canada Segment.

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