What is 89bio 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, 89bio's Probability of Financial Distress (%) is 0.04%.
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 89bio's Probability of Financial Distress (%)
For the Biotechnology subindustry, 89bio'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.
89bio's Probability of Financial Distress (%) Distribution in the Biotechnology Industry
For the Biotechnology industry and Healthcare sector, 89bio's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where 89bio's Probability of Financial Distress (%) falls into.
89bio 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 |
| = | -7.82 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.04% |
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).
89bio (ETNB) Business Description
Traded in Other Exchanges
N/A
Address
142 Sansome Street, Second Floor, San Francisco, CA, USA, 94104
89bio Inc is a United States-based clinical-stage biopharmaceutical company focused on the development and commercialization of therapies for the treatment of liver and cardio-metabolic diseases. Its product candidate, pegozafermin (previously BIO89-100), a specifically engineered glycoPEGylated analog of fibroblast growth factor 21 (FGF21), is currently being developed for the treatment of nonalcoholic steatohepatitis (NASH) and for the treatment of severe hypertriglyceridemia (SHTG).
Executives
| Kathleen Laporte |
director |
|
| Rohan Palekar |
director, officer: Chief Executive Officer |
201 SPEAR STREET, THIRD FLOOR, SAN FRANCISCO CA 94105 |
| Atkinson Edward Morrow Iii |
director |
C/O 89BIO, INC., 142 SANSOME STREET, SECOND FLOOR, SAN FRANCISCO CA 94104 |
| Quoc Le-nguyen |
officer: See Remarks |
535 MISSION STREET, 14TH FLOOR, SAN FRANCISCO CA 94105 |
| Ryan Martins |
officer: Chief Financial Officer |
535 MISSION STREET, 14TH FLOOR, SAN FRANCISCO CA 94105 |
| Michael R Hayden |
director |
C/O ASPREVA PHARMACEUTICALS CORPORATION, 1203-4464 MARKHAM STREET, VICTORIA A1 V8Z 7X8 |
| Ra Capital Healthcare Fund Lp |
director, 10 percent owner |
200 BERKELEY STREET, 18TH FLOOR, BOSTON MA 02116 |
| Ra Capital Nexus Fund, L.p. |
director, 10 percent owner |
200 BERKELEY STREET, 18TH FLOOR, BOSTON MA 02116 |
| Ram Waisbourd |
officer: See Remarks |
535 MISSION STREET, 14TH FLOOR, SAN FRANCISCO CA 94105 |
| Orbimed Advisors Llc |
director, 10 percent owner |
601 LEXINGTON AVENUE, 54TH FLOOR, NEW YORK NY 10022 |
| Gregory Grunberg |
director, 10 percent owner |
100 BEAVER STREET, WALTHAM MA 02453 |
| Anat Naschitz |
director, 10 percent owner |
535 MISSION STREET, 14TH FLOOR, SAN FRANCISCO CA 94105 |
| Longitude Capital Partners Iii, Llc |
10 percent owner |
800 EL CAMINO, SUITE 220, MENLO PARK CA 94025 |
| Lota S. Zoth |
director |
334 CR 692, BUFFALO GAP TX 79508 |
| Steven Altschuler |
director |
MEAD JOHNSON NUTRITION COMPANY, 2701 PATRIOT BLVD, GLENVIEW IL 60026 |
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