Z-Score - Definition

In statistics, a quantification of the distance of a data point from the average of a set of data points. A z-score of zero indicates that that the data point is equal to the mean or average. It is often used to measure a person's or company's likelihood of bankruptcy.

The z-score often involves careful research, so that a number of ratios regarding aspects of the corporation can be developed and applied. Among the data Analysis that is collected is the Rate of production, average pay per hourly employee, marketing budget, capital assets, and growth projections for the next several years. Along with the data analysis, the z-score will also include a thorough credit analysis as well. The financial condition of the company, including the credit-worthiness of the corporation, provides a great deal of relevant information that can be compared with industry averages.

Terms near "Z-Score"

Z-Share

Z-Test

Z-Tranche

Zacks Investment Research

ZAR

Zero Balance Account (ZBA)

Zero Basis Risk Swap (ZEBRA)

Zero Bound

Zero Cost Collar

Zero Coupon