Altman's Bankruptcy Model

High mortgage rates destroyed the value of mortgage-backed loans, which is the primary asset of the savings and loans association. The fixed-rate loans were sold at a loss in order to balance withdrawals. That asset liability mismatch was identified as the primary cause of the savings and loan crisis. Jobs were lost and unemployment rose from around 7.5% to more than 10%. The recession caused a loss of 2.9 million jobs, representing a 3% drop in payroll employment.

Freeport-McMoRan (FCX) has lost half of its market value so far this year, but the stock has made a comeback in the past couple of months, gaining more than 42% since the end of August. However, this impressive run might come to an end due to the company’s weak third-quarter results that were released last Thursday. In addition, the weakness in the copper market is expected to continue, at least in the short run, and this will have a negative impact on Freeport. Let’s take a look at the reasons why Freeport might face weakness in the near-term, and what steps the company is undertaking to overcome them. The copper market outlook is weak The copper market has been under pressure over the past year as evident from the chart given below: Source Looking ahead, the

The stock price had been declining following this announcement but had a big plummet during the presidential election. The stock price is still now hovering around thirty cents. I believe that this stock has good potential to grow, viewing the upwards trend over the past three months. Although the price for iron ore has gone down significantly, the stock price continues to rise. With new mining technologies, it is a good choice for investing although it may be a bit risky for long term purchases.

Past delinquency plays the largest role in hurting your credit score. One recent 30 day late payment will lower your credit score, most likely by 20 points! A couple of late payments, and your score will drop very far, very fast. 60 day lates

Enerplus: A Risky Player for Defensive Investors Summary: • Oil prices declined again after gaining momentum in the last week. • Enerplus is currently undervalued, but the company’s stock will face more pressure in the coming days. • Oil fundamentals are still bleak from increasing supplies and Iranian deals. • This is potentially a risky play for defensive investors. Enerplus Corp (ERF) has emerged as one of the worst beaten-down stocks over the past three months, ever since oil collapsed to six year lows in mid-August and crude hovered at around $45 a barrel for more than four weeks.

A current ratio should be more than 2.0 as a higher current ratio indicates a more promising current debt payments. As you can see, KHB had ratio around 1.60 only during those 3 years. This shows that it is highly risky or highly leveraged. On the other hand, the PMMB had an average ratio of 4.1 within those 3 years. Therefore,

If your income is above the median for your state, or you can pay back at least $100 per month toward your debts, then you'll be turned down for Chapter 7. Instead, you'll be shifted into Chapter 13, where you pay back a portion of the debt

Two concepts you discussed that this reply will expound upon further are, inventory turnover and maintaining top talent. From the example of Target alone we can see that it is not feasible to look at one metric or ratio alone. One must asses several metrics in order to get a clear picture of the financial stability of a given organization. According to Hançerlioğulları, Şen,& Aktunç (2016), “managing inventories is at the core of operational performance in many industries” (p. 681). Though Targets inventory turnover is low which may be thought to be a downfall of the corporation, Target CEO justifies the actions Target takes and use specific strategy in order to ensure the best use of space and products in order to keep cost lows and shelves

The debt ratio should be as low as possible to make sure that the company is optimally leveraged. Banks find it hard to offer good loans to companies which are highly leveraged due to high likelihood of default. Only enough inventories should be kept: Inventory is known to tie up funds especially when it is not fast moving. The business should establish optimal inventory levels for various products depending on how fast they move. The principle of “Just In Time” would come in handy in this case.

For instance, the company has reduced its all-in-sustaining costs by over 21% to $848 per ounce from $1,067 per ounce last year. Also, its all-in costs have dropped by more than 40% to $949 per ounce from $1,577 per ounce in the third quarter of 2014. Goldcorp was able to achieve these strong results due to its operating for excellence initiative. The company has achieved benefits of about $250 million through this program in the first nine months of the year. As a part of this initiative, Goldcorp is undertaking steps to increase recovery rates, improve grades, and implement steps to reduce costs as we will shortly

1) a. current liability: Money that a business owner must pay to a creditor within 12 months of the balance sheet date is a current liability. Ideally, short-term assets, such as cash and accounts receivable, should more than offset short-term liabilities, such as accounts payable, notes payable and payroll. If they do, the company 's short-term liquidity position is positive, which suggests the company will likely meet its cash-flow needs and remain a going concern. It is wise for a business owner to remain alert to his company 's current liabilities and the cash and assets that will be turned to cash within one year to meet these obligations. 1) b.

Their image rating fell above of what is expected to make up the “difference” one might think. In review of the financial summary, they are operating aspects appear to be solid, even though they are not keeping in cash on hand. Keeping no cash on hand is not always a bad idea; it can help with the overall operations of the company, even though there default risk is high. The company has an average amount of assets compared to the other companies with the industry. There currently liabilities are what put the company at a higher risk for default with no cash on hands.