Altman Z-Score Calculator

Welcome to our Altman Z-Score Calculator - Your tool for evaluating financial stability. Input financial data, and our calculator will help you estimate the Altman Z-Score.

This essential financial metric empowers you to make informed credit assessments, investment decisions, and gauge the financial health of a company with precision.

$
$
$
$
$
$
$

AltmanZ-Score

0.00

Navigating the Altman Z-Score Calculator for Financial Health

The Altman Z-Score is synonymous with assessing a company's financial stability and credit strength.

Introduced by Edward Altman in the 1960s, it remains a prominent predictive tool for gauging the likelihood of bankruptcy.

The Altman Z-Score Calculator simplifies this process, offering businesses and analysts an easy way to calculate a company's Z-Score and understand its financial resilience.

How to Use the Altman Z-Score Calculator

Engaging with the Altman Z-Score Calculator requires a systematic approach:

  1. Gather Financial Statements: Before using the calculator, collect your most recent financial statements. Your balance sheet and income statement will be needed to find the necessary figures.

  2. Input Financial Figures: Enter the following data accurately:

    • Total Assets

    • Working Capital (Current Assets minus Current Liabilities)

    • Retained Earnings

    • Earnings Before Interest and Taxes (EBIT)

    • Market Value of Equity (usually equated to the company's market capitalization)

    • Total Liabilities

    • Sales (Annual Revenue)

  3. Calculate: After inputting all the figures, you can calculate the Altman Z-Score by clicking the designated button.

The calculator uses the following formula components to deliver the Z-Score:

Finally, the Altman Z-Score is computed as:

Altman Z-Score=(1.2×A)+(1.4×B)+(3.3×C)+(0.6×D)+(1.0×E)

Real-World Example

Consider 'Tech Innovations Inc.', a hypothetical technology firm assessing its financial health. The company has the following financial data:

Using the Altman Z-Score Calculator, Tech Innovations would compute individual ratios as follows:

Their Altman Z-Score computes as:

(1.2×0.16)+(1.4×0.10)+(3.3×0.20)+(0.6×3.75)+(1.0×1.20)=5.29

With an Altman Z-Score of above 3, Tech Innovations Inc. is likely to be in a stable financial position with a low risk of bankruptcy.

The Formula

Understanding the underlying metrics in the Altman Z-Score formula is crucial:

Important Facts

The Altman Z-Score is more than a mere number; it is a testament to a company's financial health and an early warning system for potential distress. The Altman Z-Score Calculator

arrowarrow