GURUFOCUS.COM » STOCK LIST » Technology » Software » F5 Inc (NAS:FFIV) » Definitions » Altman Z-Score

F5 (FFIV) Altman Z-Score : 5.18 (As of Oct. 31, 2024)


View and export this data going back to 1999. Start your Free Trial

What is F5 Altman Z-Score?

The Altman Z-Score is a model designed to predict the likelihood of a company going bankrupt within the next two years. Created by American finance professor Edward Altman in 1968, the model is specifically designed for publicly traded manufacturing companies with assets greater than $1 million.

Good Sign:

Altman Z-score of 5.18 is strong.

F5 has a Altman Z-Score of 5.18, indicating it is in Safe Zones. This implies the Altman Z-Score is strong.

The zones of discrimination were as such:

When Altman Z-Score <= 1.8, it is in Distress Zones.
When Altman Z-Score >= 3, it is in Safe Zones.
When Altman Z-Score is between 1.8 and 3, it is in Grey Zones.

The historical rank and industry rank for F5's Altman Z-Score or its related term are showing as below:

FFIV' s Altman Z-Score Range Over the Past 10 Years
Min: 3.26   Med: 5.03   Max: 7.96
Current: 5.18

During the past 13 years, F5's highest Altman Z-Score was 7.96. The lowest was 3.26. And the median was 5.03.


F5 Altman Z-Score Historical Data

The historical data trend for F5's Altman Z-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

F5 Altman Z-Score Chart

F5 Annual Data
Trend Sep15 Sep16 Sep17 Sep18 Sep19 Sep20 Sep21 Sep22 Sep23 Sep24
Altman Z-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only 3.33 4.19 3.26 4.01 4.92

F5 Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
Altman Z-Score Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 4.01 4.26 4.47 4.32 4.92

Competitive Comparison of F5's Altman Z-Score

For the Software - Infrastructure subindustry, F5's Altman Z-Score, along with its competitors' market caps and Altman Z-Score 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.


F5's Altman Z-Score Distribution in the Software Industry

For the Software industry and Technology sector, F5's Altman Z-Score distribution charts can be found below:

* The bar in red indicates where F5's Altman Z-Score falls into.



F5 Altman Z-Score Calculation

Altman Z-Score model is an accurate forecaster of failure up to two years prior to distress. It can be considered the assessment of the distress of industrial corporations.

F5's Altman Z-Score for today is calculated with this formula:

Z=1.2*X1+1.4*X2+3.3*X3+0.6*X4+1.0*X5
=1.2*0.1104+1.4*0.5602+3.3*0.1239+0.6*5.5902+1.0*0.5017
=5.18

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency. GuruFocus does not calculate Altman Z-Score when X4 or X5 value is 0.

Trailing Twelve Months (TTM) ended in Sep. 2024:
Total Assets was $5,613 Mil.
Total Current Assets was $2,109 Mil.
Total Current Liabilities was $1,490 Mil.
Retained Earnings was $3,144 Mil.
Pre-Tax Income was 203.514 + 171.619 + 145.934 + 174.398 = $695 Mil.
Interest Expense was 0 + 0 + 0 + 0 = $0 Mil.
Revenue was 746.674 + 695.495 + 681.354 + 692.597 = $2,816 Mil.
Market Cap (Today) was $13,884 Mil.
Total Liabilities was $2,484 Mil.

* Note that for stock reported semi-annually or annually, GuruFocus uses latest annual data as the TTM data.

X1=Working Capital/Total Assets
=(Total Current Assets - Total Current Liabilities)/Total Assets
=(2109.471 - 1489.653)/5613.004
=0.1104

X2=Retained Earnings/Total Assets
=3144.401/5613.004
=0.5602

X3=Earnings Before Interest and Taxes/Total Assets
=(Pre-Tax Income - Interest Expense)/Total Assets
=(695.465 - 0)/5613.004
=0.1239

X4=Market Value Equity/Book Value of Total Liabilities
=Market Cap/Total Liabilities
=13883.885/2483.626
=5.5902

X5=Revenue/Total Assets
=2816.12/5613.004
=0.5017

The zones of discrimination were as such:

Distress Zones - 1.81 < Grey Zones < 2.99 - Safe Zones

F5 has a Altman Z-Score of 5.18 indicating it is in Safe Zones.

Study by Altman found that companies that are in Distress Zone have more than 80% of chances of bankruptcy in two years.


F5  (NAS:FFIV) Altman Z-Score Explanation

X1: The Working Capital/Total Assets (WC/TA) ratio is a measure of the net liquid assets of the firm relative to the total capitalization. Working capital is defined as the difference between current assets and current liabilities. Ordinarily, a firm experiencing consistent operating losses will have shrinking current assets in relation to total assets. Altman found this one proved to be the most valuable liquidity ratio comparing with the current ratio and the quick ratio. This is however the least significant of the five factors.

X2: Retained Earnings/Total Assets: the RE/TA ratio measures the leverage of a firm. Retained earnings is the account which reports the total amount of reinvested earnings and/or losses of a firm over its entire life. Those firms with high RE, relative to TA, have financed their assets through retention of profits and have not utilized as much debt.

X3, Earnings Before Interest and Taxes/Total Assets (EBIT/TA): This ratio is a measure of the true productivity of the firm's assets, independent of any tax or leverage factors. Since a firm's ultimate existence is based on the earning power of its assets, this ratio appears to be particularly appropriate for studies dealing with corporate failure. This ratio continually outperforms other profitability measures, including cash flow.

X4, Market Value of Equity/Book Value of Total Liabilities (MVE/TL): The measure shows how much the firm's assets can decline in value (measured by market value of equity plus debt) before the liabilities exceed the assets and the firm becomes insolvent.

X5, Revenue/Total Assets (S/TA): The capital-turnover ratio is a standard financial ratio illustrating the sales generating ability of the firm's assets.

Read more about Altman Z-Score and the original research.


Be Aware

Altman Z-Score does not apply to financial companies.


F5 Altman Z-Score Related Terms

Thank you for viewing the detailed overview of F5's Altman Z-Score provided by GuruFocus.com. Please click on the following links to see related term pages.


F5 Business Description

Traded in Other Exchanges
Address
801 5th Avenue, Seattle, WA, USA, 98104
F5 is a market leader in the application delivery controller market. The company sells products for security, application performance, and automation. Its three customer verticals are enterprises, service providers, and government entities. Revenue is evenly split between its services business and products business with revenue trending toward products due to software adoption. The Seattle-based firm was incorporated in 1996, has about 6,500 employees, and generates about 55% its revenue within the Americas, 25% in EMEA, and 20% in APAC/Japan.
Executives
Francis J. Pelzer officer: EVP, Chief Financial Officer CONCUR TECHNOLOGIES, INC., 18400 NE UNION HILL RD., REDMOND WA 98052
Alan Higginson director
Francois Locoh-donou director, officer: President, CEO & Director C/O F5 NETWORKS, INC., 401 ELLIOTT AVE. W., SEATTLE WA 98119
Chad Michael Whalen officer: EVP, Worldwide Sales C/O F5 NETWORKS, INC., 401 ELLIOTT AVE. WEST, SEATTLE WA 98119
Thomas Dean Fountain officer: EVP and Chief Strategy Officer C/O F5 NETWORKS, INC., 401 ELLIOTT AVE. WEST, SEATTLE WA 98119
Scot Frazier Rogers officer: Interim General Counsel C/O F5 NETWORKS, INC., 401 ELLIOTT AVE. WEST, SEATTLE WA 98119
Michael L Dreyer director C/O F5 NETWORKS, INC., 401 ELLIOTT AVE. WEST, SEATTLE WA 98119
Tami A. Erwin director 1095 AVENUE OF THE AMERICAS, NEW YORK NY 10036
Ana Maria White officer: EVP and Chief HR Officer C/O F5 NETWORKS, INC., 401 ELLIOTT AVE. WEST, SEATTLE WA 98119
Mika Yamamoto officer: EVP, Chief Marketing Officer 21300 VICTORY BLVD.,, 12TH FLOOR, WOODLAND HILLS CA 91367
Geng Lin officer: EVP, Chief Technology Officer C/O F5 NETWORKS, INC., 401 ELLIOTT AVE. WEST, SEATTLE WA 98119
Marianne Budnik director C/O ACME PACKET, INC., 100 CROSBY DRIVE, BEDFORD MA 01730
Phillips James Malcolm Jr director C/O F5, INC., 801 FIFTH AVE., SEATTLE WA 98104
Michael F Montoya director C/O F5 NETWORKS, INC., 801 FIFTH AVE., SEATTLE WA 98104
Deborah L Bevier director PO BOX 91258, BELLEVUE WA 98009