Overview
Altman Z-Score combines balance-sheet and profitability signals to estimate distress risk.
Formula
Z = 1.2A + 1.4B + 3.3C + 0.6D + 1.0E
How to Interpret
High Value
A higher score generally indicates lower financial distress risk.
Low Value
A lower score can warn of financial fragility.
Where It Is Used
Altman Z-Score should be paired with at least one complementary quality metric in decision filters.