What is Zimmer Biomet Holdings 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, Zimmer Biomet Holdings's Probability of Financial Distress (%) is 0.03%.
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 Zimmer Biomet Holdings's Probability of Financial Distress (%)
For the Medical Devices subindustry, Zimmer Biomet Holdings'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.
Zimmer Biomet Holdings's Probability of Financial Distress (%) Distribution in the Medical Devices & Instruments Industry
For the Medical Devices & Instruments industry and Healthcare sector, Zimmer Biomet Holdings's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where Zimmer Biomet Holdings's Probability of Financial Distress (%) falls into.
Zimmer Biomet Holdings 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 |
| = | -8.23 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.03% |
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).
Zimmer Biomet Holdings (Zimmer Biomet Holdings) Business Description
Traded in Other Exchanges
Address
345 East Main Street, Warsaw, IN, USA, 46580
Zimmer Biomet designs, manufactures, and markets orthopedic reconstructive implants, as well as supplies and surgical equipment for orthopedic surgery. With the acquisitions of Centerpulse in 2003 and Biomet in 2015, Zimmer holds the leading share of the reconstructive market in the United States, Europe, and Japan. Roughly two thirds of total revenue is derived from sales of large joints, another quarter comes from extremities, trauma, sports medicine, and related surgical products. The firm spun out its dental and spine businesses in 2022.
Executives
| Syed A. Jafry |
director |
345 E. MAIN STREET, WARSAW IN 46580 |
| Sreelakshmi Kolli |
director |
C/O ALIGN TECHNOLOGY INC., 2820 ORCHARD PARKWAY, SAN JOSE CA 94131 |
| Christopher B Begley |
director |
|
| Robert Hagemann |
director |
3 GIRALDA FARMS, MADISON NJ 07940 |
| Michael W Michelson |
director |
2800 SAND HILL ROAD, SUITE 200, MENLO PARK CA 94025 |
| Betsy J Bernard |
director |
711 HIGH STREET, DES MOINES IA 50392-0300 |
| Arthur J Higgins |
director |
C/O ZIMMER, INC., P.O. BOX 708, WARSAW IN 46580 |
| Chad F Phipps |
officer: Assoc. Gen. Counsel, Corp. Sec |
C/O ZIMMER, INC., P.O. BOX 708, WARSAW IN 46580 |
| Zuilen Wilfred Van |
officer: Pres, Europe, M. East & Africa |
345 E. MAIN STREET, WARSAW IN 46580 |
| Paul A Stellato |
officer: VP, Controller & CAO |
C/O XYLEM INC, 1 INTERNATIONAL DRIVE, RYE BROOK NY 10573 |
| Sang Yi |
officer: President, Asia Pacific |
345 E. MAIN STREET, WARSAW IN 46580 |
| Lori Winkler |
officer: SVP and CHRO |
345 E. MAIN STREET, WARSAW IN 46580 |
| Rachel Ellingson |
officer: SVP & CSO |
345 E MAIN STREET, WARSAW K7 46580 |
| Bryan C Hanson |
director, officer: President and CEO |
ZIMMER BIOMET HOLDINGS, 345 E. MAIN STREET, WARSAW IN 46580 |
| Aure Bruneau |
officer: Group President |
345 E. MAIN STREET, WARSAW IN 46580 |
Zimmer Biomet Holdings (Zimmer Biomet Holdings) Headlines
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