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Altman Z Score Calculator

Work out altman z score instantly with clear inputs, formula shown and shareable results.

About Altman Z Score Calculator

This is the Altman Z''-score, the variant calibrated for private and non-manufacturing companies. It weights liquidity, cumulative profitability, operating profitability and balance sheet strength; above 2.6 is the safe zone, below 1.1 signals elevated distress risk.

Formulas

Altman Z''

Z'' = 6.56 x (WC/TA) + 3.26 x (RE/TA) + 6.72 x (EBIT/TA) + 1.05 x (Equity/Total liabilities)

Zones

Above 2.60 safe; 1.10 to 2.60 grey; below 1.10 distress

Worked example

With the default values below, Altman Z Score Calculator returns Altman Z''-score of 3.723. Change any input above and every figure here is recalculated in your browser.

Inputs used

Working capital / total assets
18
Retained earnings / total assets
24
EBIT / total assets
9
Book equity / total liabilities
1.1

Results

Altman Z''-score
3.723
Zone
Safe zone
Contribution from EBIT / assets
0.605
Contribution from working capital / assets
1.181

Step by step

  1. 1Values used
  2. 2Altman Z''
  3. 3Zones
  4. 4Altman Z''-score= 3.723
  5. 5Zone= Safe zone
  6. 6Contribution from EBIT / assets= 0.605
  7. 7Contribution from working capital / assets= 1.181

Assumptions and limits

  • The result is derived only from the 4 inputs listed above. Anything not among them is not part of the calculation.
  • In particular, this calculator does not take inflation, fees or charges or compounding frequency into account.
  • Figures are rounded for display to 3 decimal places, so totals built from several rounded parts can differ slightly from the unrounded arithmetic.
  • Statistical screening indicator only. A Z-score is not a credit rating or a prediction of insolvency and should not be relied on for lending, investment or legal decisions.
  • This is an estimate for general information and not professional financial, tax or legal advice. See the full disclaimer for the limits that apply to this kind of calculator.

How these calculators are built and tested is described on the Methodology page. If a figure looks wrong, please report it.

Statistical screening indicator only. A Z-score is not a credit rating or a prediction of insolvency and should not be relied on for lending, investment or legal decisions.

Frequently Asked Questions

Why not the original Z-score?

The original uses market value of equity and a sales/assets term, which only works for listed manufacturers. The Z'' variant drops both.

How reliable is it?

It is a screening tool with good historical accuracy one to two years out, not a prediction. Treat a grey-zone result as a prompt to investigate, not a verdict.

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