Altman's Z-Score Model as a Bankruptcy Predictor in the Ecuadorian Stock Market, 2014-2024
DOI:
https://doi.org/10.29076/issn.2528-7737vol19iss52.2026pp128-137pKeywords:
Altman Z-Score model, bankruptcy prediction, financial risk, stock market, corporate insolvency, EcuadorAbstract
This study examines the financial condition of the companies that operated in the Ecuadorian securities market between 2014 and 2024, with the aim of assessing the applicability of Altman's Z-Score model to identify conditions of financial vulnerability and their relationship with subsequent default events. Drawing on official data and a representative sample of issuances, the study analyzed the liquidity, profitability, equity solvency, and asset-turnover ratios that make up the model. A total of 54.86% of the companies analyzed fell within the financial-risk zone. Statistical tests revealed significant differences across zones in liquidity, retained earnings, operating profitability, and asset turnover; however, no statistically significant association was found between the zone classification and the subsequent occurrence of default. The findings support the use of the Z-Score as a complementary early-warning and financial-vulnerability assessment tool in the Ecuadorian securities market
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