Bloomberg Altman Z-score test

    
In your first Bloomberg task you will have to use Altman’s Z score to determine if companies Boeing is going to fail in the near future.

For more information, see: http://en.wikipedia.org/wiki/Altman_Z-score. 
The following is the formula for most public companies (there are small differences for financial companies, private companies as so on) 
Z=1.2X1+1.4X2+3.3X3+0.6X4+0.999X5 
X1 = Working Capital / Total Assets
X2 = Retained Earnings / Total Assets
X3 = EBIT / Total Assets
X4 = Market Value of Equity /Book Value of Total Liabilities 
X5 = Sales/ Total Assets 

Don't use plagiarized sources. Get Your Custom Essay on
Bloomberg Altman Z-score test
Just from $13/Page
Order Essay

A Z score higher than 2.99 is considered a safe score; between 1.8 and 2.99 it is a grey area; below 1.8 is the danger area.

Each of you were assigned a “blue chip” company. You will need to find a company that is in more danger than blue chips. Bloomberg uses a system of rankings and computes the probability of default. It is under the function DRSK. The following grab shows an example. You will select companies with HY 2 and above. Those companies have higher probabilities of default. 
  
To select such companies I suggest that you search for companies that have bonds rated CCC- to CCC+. To do so you will need to go to CORP and do a search. I suggest the following fields for your search. However, any other way you devise to select companies with a high HY is fine by me.
 
Once you have the second company you will have to compute the Z scores for the past three years for both companies. You will compare the scores between the “blue chip” and the “danger zone” company and determine if the Z score you computed is similar with the one that you can find for both companies in Bloomberg. In addition, you will see if the Z score you computed is correlated with the probability of default that Bloomberg computed in DRSK. As a conclusion you will need to make a prediction if the danger zone company will default in the next two years. 

You will present your results in a format that will include your computations, your comments and the necessary Bloomberg grabs that show your work (mainly the DRSK grabs of your two companies and some grabs showing an example on how you extracted the relevant data.) 

Order a unique copy of this paper
(550 words)

Approximate price: $22

Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

At Solution Essays, we are determined to deliver high-quality papers to our clients at a fair price. To ensure this happens effectively, we have developed 5 beneficial guarantees. This guarantees will ensure you enjoy using our website which is secure and easy to use.

Money-back guarantee

Most companies do not offer a money-back guarantee but with Solution Essays, it’s either a quality paper or your money back. Our customers are assured of high-quality papers and thus there are very rare cases of refund requests due to quality concern.

Read more

Zero-plagiarism guarantee

All our papers are written from scratch and according to your specific paper instructions. This minimizes any chance of plagiarism. The papers are also passed through a plagiarism-detecting software thus ruling out any chance of plagiarism.

Read more

Free-revision policy

We offer free revisions in all orders delivered as long as there is no alteration in the initial order instruction. We will revise your paper until you are fully satisfied with the order delivered to you.

Read more

Privacy policy

All data on our website is stored as per international data protection rules. This ensures that any personal data you share with us is stored safely. We never share your personal data with third parties without your consent.

Read more

Fair-cooperation guarantee

Ordering and sending money to us is an indication that you are purchasing our products and services. To have business talks laid out in the official language, you can check on our terms and conditions and get more information about this.

Read more

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Order your essay today and save 20% with the discount code: LEMONADEPlace Order
Live Chat+1(978) 822-0999EmailWhatsApp