What is DaVita 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, DaVita's Probability of Financial Distress (%) is 0.04%.
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 DaVita's Probability of Financial Distress (%)
For the Medical Care Facilities subindustry, DaVita'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.
DaVita's Probability of Financial Distress (%) Distribution in the Healthcare Providers & Services Industry
For the Healthcare Providers & Services industry and Healthcare sector, DaVita's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where DaVita's Probability of Financial Distress (%) falls into.
DaVita 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 |
| = | -7.72 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.04% |
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).
DaVita (DaVita) Business Description
Traded in Other Exchanges
Address
2000 16th Street, Denver, CO, USA, 80202
DaVita is the largest provider of dialysis services in the United States, boasting market share that eclipses 35% when measured by both patients and clinics. The firm operates over 3,000 facilities worldwide, mostly in the U.S., and treats over 240,000 patients globally each year. Government payers dominate U.S. dialysis reimbursement. DaVita receives about two thirds of U.S. sales at government (primarily Medicare) reimbursement rates, with the remainder coming from commercial insurers. However, while commercial insurers represented only about 10% of the U.S. patients treated, they represent nearly all of the profits generated by DaVita in the U.S. dialysis business.
Executives
| Christopher Michael Berry |
officer: Chief Accounting Officer |
C/O SONDER HOLDINGS INC., 101 15TH ST., SAN FRANCISCO CA 94103 |
| Kathleen Alyce Waters |
officer: Chief Legal Officer |
C/O DAVITA INC., 2000 16TH STREET, DENVER CO 80202 |
| Wendy Lee Schoppert |
director |
6105 TRENTON LANE NORTH, MINNEAPOLIS MN 55442 |
| Phyllis R Yale |
director |
|
| Javier Rodriguez |
officer: Chief Executive Officer, DKC |
601 HAWAII ST., EL SEGUNDO CA 90245 |
| Barbara J Desoer |
director |
CITIGROUP INC., 388 GREENWICH STREET, 17TH FLOOR, NEW YORK NY 10013 |
| James O Hearty |
officer: Chief Compliance Officer |
2000 16TH STREET, DENVER CO 80202 |
| Charles Berg |
director, officer: Executive Chair, DMG |
48 MONROE TURNPIKE, TRUMBULL CT 06611 |
| John M Nehra |
director |
1119 ST PAUL ST, BALTIMORE MD 21202 |
| Adam H Schechter |
director |
2000 GALLOPING HILL ROAD, KENILWORTH NJ 07033 |
| Michael David Staffieri |
officer: Chief Operating Officer, DKC |
2000 16TH STREET, DENVER CO 80202 |
| Jason M. Hollar |
director |
3333 BEVERLY ROAD, HOFFMAN ESTATES IL 60179 |
| Paula A Price |
director |
ONE CVS DRIVE, WOONSOCKET RI 02895 |
| Pamela M Arway |
director |
601 HAWAII ST., EL SEGUNDO CA 90245 |
| Gregory J. Moore |
director |
130 EAST RANDOLPH STREET, SUITE 1000, CHICAGO IL 60601 |
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