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Strategies & Market Trends : Bankruptcy Predictor Model -- Ignore unavailable to you. Want to Upgrade?

To: Razorbak who wrote (23)	3/15/1999 12:46:00 PM
From: SDR-SI	Respond to of 477

I would guess that there are several classes of companies for which the actual Z-value of the predictive model may be of very limited usefulness (startups, development stages, recapitalizations, "companies whose capitalization is characterized by irrational market exuberance", etc). However, it would not be unreasonable to believe that the model, applied consistently to a company operating under consistent and legitimate accounting principles, could provide trending information of useful comparison over a period of time. I guess another major consideration is that the the calculation is apparently intended to provide a quick and generalized guideline, rather than being intended as a stand-alone "acid test" designed for application without a lot of other information being available to the inquirer. JMO Steve