What is EOG Resources Probability of Financial Distress (%)?
Probability of Financial Distress (%) measures the probability that a company will go bankrupt in the upcoming year given its current financial position. A higher ratio indicates a larger probability of bankruptcy for the company, while a lower ratio indicates a healthier fundamental. As of today, EOG Resources's Probability of Financial Distress (%) is 0.01%.
Like the Altman Z-Score, the PFD measures a company's bankruptcy risk. However, the main drawback of the Z-score is it does not apply to banks and insurance companies. According to Investopedia, the concept of "working capital" does not apply to banks and insurance companies, as financial institutions do not have typical current assets or current liabilities like inventories or accounts payable.
Competitive Comparison of EOG Resources's Probability of Financial Distress (%)
For the Oil & Gas E&P subindustry, EOG Resources's Probability of Financial Distress (%), along with its competitors' market caps and Probability of Financial Distress (%) 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.
EOG Resources's Probability of Financial Distress (%) Distribution in the Oil & Gas Industry
For the Oil & Gas industry and Energy sector, EOG Resources's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where EOG Resources's Probability of Financial Distress (%) falls into.
EOG Resources Probability of Financial Distress (%) Calculation
Probability of Financial Distress (%) (PFD) was developed by John Campbell, Jens Hilscher and Jan Szilagyi in their Search of Distress Risk. It measures the probability that a company will go bankrupt within the next 12 months given its current financial position.
The Probability of Financial Distress (%) was obtained by a logit probability model based on eight explanatory variables. The logit formula to compute the probability of financial distress (LPFD) is given below:
| LPFD | = | -20.12 * NIMTAAVG | + | 1.60 * TLMTA | - | 7.88 * EXRETAVG | + | 1.55 * SIGMA | - | 0.005 * RSIZE | - | 2.27 * CASHMTA | + | 0.070 * MB | - | 0.09 * PRICE | - | 8.87 |
| = | -8.99 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.01% |
The eight explanatory variables are:
1. NIMTAAVG = Net Income to Market Total Assets
*Note that for companies reported quarterly, geometrically declining weighted quarterly Net Income data in latest four quarters are used.
2. TLMTA = Total liabilities to Market Total Assets
3. CASHMTA = Cash to Market Total Assets
For non-financial companies, CASHMTA is measured as:
4. EXRETAVG = Excess Return compared to the S&P 500
EXRETAVG is the weighted excess return compared to the S&P 500 in past 12 month. Geometrically declining weights are imposed on the monthly excess return to reflect lagged information. The weight is halved each quarter.
5. SIGMA = Standard Deviation of Daily Returns
For sigma, we use the annualized standard deviation of a company's returns over the past 92 days (or 63 trading days).
6. RSIZE = Relative Size
| RSIZE | = | log (Market Cap | / | Total Market Cap of S&P 500 companies) |
7. MB = Market to Adjusted Book Equity Ratio
8. PRICE
PRICE is measured as the log of the stock price, capped at log(15).
EOG Resources (EOG Resources) Business Description
Traded in Other Exchanges
Address
1111 Bagby, Sky Lobby 2, Houston, TX, USA, 77002
EOG Resources is an oil and gas producer with acreage in several U.S. shale plays, including the Permian Basin, the Eagle Ford, and the Bakken. At the end of 2022, it reported net proved reserves of 4.2 billion barrels of oil equivalent. Net production averaged 908 thousand barrels of oil equivalent per day in 2022 at a ratio of 73% oil and natural gas liquids and 27% natural gas.
Executives
| Helms Lloyd W Jr |
officer: EVP, Operations |
1111 BAGBY, SKY LOBBY 2, HOUSTON TX 77002 |
| Jeffrey R. Leitzell |
officer: EVP Exploration and Production |
1111 BAGBY, SKY LOBBY 2, HOUSTON TX 77002 |
| Lynn A Dugle |
director |
4803 STONECROFT BOULEVARD, CHANTILLY VA 20151 |
| Michael T. Kerr |
director |
1111 BAGBY, SKY LOBBY 2, HOUSTON TX 77002 |
| Kenneth W. Boedeker |
officer: EVP Exploration and Production |
1111 BAGBY, SKY LOBBY 2, HOUSTON TX 77002 |
| Michael P Donaldson |
officer: VP, General Counsel & Corp Sec |
1111 BAGBY STREET, SKY LOBBY 2, HOUSTON TX 77002 |
| Timothy K Driggers |
officer: VP Accounting & Land Admin |
|
| Ann D. Janssen |
officer: VP, Accounting |
1111 BAGBY, SKY LOBBY 2, HOUSTON TX 77002 |
| Ezra Y Yacob |
officer: EVP Exploration and Production |
1111 BAGBY, SKY LOBBY 2, HOUSTON TX 77002 |
| Charles R Crisp |
director |
1301 MCKINNEY STE 700, HOUSTON TX 77010 |
| Donald F Textor |
director |
P O BOX 4362, HOUSTON TX 772104362 |
| Frank G Wisner |
director |
P O BOX 4362, HOUSTON TX 7721042362 |
| Julie J Robertson |
director |
13135 S DAIRY ASHFORD, STE 800, SUGAR LAND TX 77478 |
| David W Trice |
officer: EVP, Exploration & Production |
1111 BAGBY, SKY LOBBY 2, HOUSTON TX 77002 |
| William R. Thomas |
officer: Sr. Executive VP, Exploitation |
1111 BAGBY, SKY LOBBY 2, HOUSTON TX 77002 |
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