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

To: Razorbak who wrote (335)	4/25/1999 9:22:00 PM
From: Sam	Respond to of 477

I'd like to see a score for WDC, if you have the time. One place to start for a quick overview and introduction: Message 9129686

To: Razorbak who wrote (335)	5/4/1999 1:49:00 PM
From: Razorbak	Read Replies (1) \| Respond to of 477

Talisman Energy (NYSE:TLM) ------------------------------------------------------- Analysis: Altman Bankruptcy Predictor Company Name: Talisman Energy Ticker Symbol: NYSE:TLM Date of Analysis: 5/4/99 Conducted by: Samuel M. Williams Vice President Turnaround & Crisis Management, Inc. Two Mid America Plaza, Suite 714 Oakbrook Terrace, IL 60181 Tel: 630-990-9718 Fax: 630-990-9693 E-mail: sam@turnrnd.com turnrnd.com ------------------------------------------------------------------------- Financial Summary, C$ Millions (1) 12/31/97A 12/31/98A 03/31/99Q ------------------------------------------------------------------------- Working Capital, WC (26.60) (304.50) (230.40) Retained Earnings, RE 307.50 48.70 52.70 Earnings B4 Interest & Taxes, EBIT 217.00 (77.60) 169.20 Market Value of Equity, MVE 4,941.39 2,890.51 3,550.98 Book Value of Tot. Liab., BVTL 2,844.30 3,243.20 3,361.30 Total Sales, TS 1,430.00 1,370.70 1,437.20 Total Assets, TA 5,030.90 5,457.20 5,795.00 ------------------------------------------------------------------------- Altman's Financial Ratios 12/31/97A 12/31/98A 03/31/99Q ------------------------------------------------------------------------- X1 = WC/TA (0.01) (0.06) (0.04) X2 = RE/TA 0.06 0.01 0.01 X3 = EBIT/TA 0.04 (0.01) 0.03 X4 = MVE/BVTL 1.74 0.89 1.06 X5 = TS/TA 0.28 0.25 0.25 ------------------------------------------------------------------------- Bankruptcy Predictor Index, Z (2) 1.55 0.68 0.94 ------------------------------------------------------------------------- Company Health Assessment (3,4,5) Near Near Near Death Death Death ------------------------------------------------------------------------- Footnotes: ---------- 1. Data obtained from the 12/31/98 Annual Report and the 5/4/99 earnings release for 1Q99 (see URLs below). MVE was valued at US$30.38/share on 12/31/97 (0.6741 US$/C$), at US$17.50/share on 12/31/98 (0.7199 US$/C$), and at US$21.5/share on 3/31/98 (0.7199 US$/C$). EBIT and TS are annual figures from the annual report or quarterly figures from the earnings release, multiplied times four for an annualized basis. biz.yahoo.com biz.yahoo.com 2. Bankruptcy Predictor Index: Z = (1.2X1)+(1.4X2)+(3.3X3)+(0.6X4)+(1.0*X5) 3. Company Health Assessment: Z > 3.0 = Strong 1.8 < Z < 3.0 = In Danger Z < 1.8 = Near Death 4. The Altman Bankruptcy Predictor is widely used in the turnaround industry to assess and predict a company's short-term survival prospects. The model is named after the renowned Edward I. Altman, Max L. Heine Professor of Finance at New York University's Stern School of Business, who published the initial research back in 1968. According to one scholarly journal, Altman's Bankruptcy Predictor has proven consistently accurate over the period of time since its development. The original samples in Altman's research displayed accuracy of 95 percent based on data from approximately one year prior to failure. The accuracy dropped to 72 percent based on two-year data. Subsequent tests on firms that have gone bankrupt since 1968 have shown an accuracy level of 82 to 85 percent. 5. CAUTION!!! This analysis should only be used as an analytical tool. While it can greatly assist an investor or stakeholder in identifying weak companies for further investigation, it should not be used to the exclusion of other types of experienced and informed personal evaluation techniques. Also, please remember that, when using the Bankruptcy Predictor Model, the recent trend is the most important indicator of future success or failure since companies' fortunes rarely turn on a dime.