What is HG Holdings 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, HG Holdings's Probability of Financial Distress (%) is 0.02%.
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 HG Holdings's Probability of Financial Distress (%)
For the Shell Companies subindustry, HG Holdings'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.
HG Holdings's Probability of Financial Distress (%) Distribution in the Diversified Financial Services Industry
For the Diversified Financial Services industry and Financial Services sector, HG Holdings's Probability of Financial Distress (%) distribution charts can be found below:
* The bar in red indicates where HG Holdings's Probability of Financial Distress (%) falls into.
HG Holdings 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 |
| = | -8.34 |
The Probability of Financial Distress (%) (PFD) was then obtianed by:
| PFD | = | 1 | / | (1 + e^(-LPFD)) | * | 100% |
| = | 0.02% |
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 insurance 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).
HG Holdings (HG Holdings) Business Description
Traded in Other Exchanges
N/A
Address
2115 East 7th Street, Suite 101, Charlotte, NC, USA, 28204
HG Holdings, Inc, together with its consolidated subsidiaries, operates through its wholly owned subsidiarie. The Company engages in the business of providing title insurance through the subsidiary NCTIC and providing title agency services through the subsidiaries NCTG, TAV, and Omega. Through NCTIC, the Company underwrites land title insurance for owners and mortgagees as the primary insurer. The Company currently only provides title insurance services in the state of Florida.
Executives
| Peter Mark Sherman |
director |
4409 MICKLETON ROAD, CHARLOTTE NC 28226 |
| Justin Hayles Edenfield |
officer: Prin. Accting & Fin. Officer |
6265 OLD WATER OAK ROAD, SUITE 204, TALLAHASSEE FL 32312 |
| Hale Partnership Capital Management, Llc |
10 percent owner |
5960 FAIRVIEW ROAD, SUITE 432, CHARLOTTE NC 28210 |
| Solas Capital Management, Llc |
10 percent owner |
1063 POST ROAD, 2ND FLOOR, DARIEN CT 06820 |
| Hale Partnership Fund, L.p. |
10 percent owner |
3335 PARK SOUTH STATION BLVD., CHARLOTTE NC 28210 |
| Matthew Hultquist |
director |
ONE CORPORATE CENTER, RYE NY 10580 |
| Bradley G Garner |
officer: CFO and CAO |
2115 E. 7TH STREET, SUITE 101, CHARLOTTE NC 28211 |
| Hale Steven A Ii |
director, 10 percent owner |
5960 FAIRVIEW ROAD, SUITE 432, CHARLOTTE NC 28210 |
| Matthew Wood Smith |
officer: Interim Chief Exec. Officer |
200 N. HAMILTON STREET, HIGH POINT NC 27260 |
| Jeffrey Stuart Gilliam |
director |
200 N. HAMILTON STREET, NO. 200, HIGH POINT NC 27260 |
| Tucker Golden Frederick |
10 percent owner |
C/O SOLAS CAPITAL MANAGEMENT, LLC, 1063 POST ROAD, 2ND FLOOR, DARIEN CT 06820 |
| Michael P Haley |
director |
200 NORTH HAMILTON STREET, NO. 200, HIGH POINT NC 27260 |
| Talanta Investment Group, Llc |
director, 10 percent owner |
401 N. TRYON STREET, 10TH FLOOR, CHARLOTTE NC 28202 |
| Justyn Rendal Putnam |
director |
200 N. HAMILTON STREET, NO. 200, HIGH POINT NC 27260 |
| Ian Dundee Lapey |
director |
200 N. HAMILTON STREET, NO. 200, HIGH POINT NC 27260 |
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