Features > Risk analysisThe methodology
The methodology3 scoring models
Any single model can be wrong. That is why ProxDeal combines three established insolvency prediction methods, each assessing risk from a different statistical angle.
Altman Z'-Score
In practice, the most important refinement of Altman's 1968 model: multiple discriminant analysis separates solvent from insolvent companies using five financial ratios, from working capital through to revenue relative to total assets. The Z' variant replaces the market value of equity with its book value, which makes it applicable to unlisted companies. Scores above 2.9 are considered sound, while anything below 1.23 falls into the distress zone.
Ohlson O-Score
The first model to express insolvency risk explicitly as a probability: a logistic regression across nine variables, from company size and leverage to binary indicators for negative equity and losses in the past two years. By comparing multiple periods, the O-Score detects warning signs that do not show up in any single balance sheet but form a characteristic pattern across several years of annual accounts.
Zmijewski Score
A probit model that corrects a methodological weakness of its predecessors: instead of overweighting insolvent companies in the training data, Zmijewski works with a more realistic ratio of solvent to insolvent companies. Because it needs only three ratios covering profitability, leverage and liquidity, the score can still be calculated even when smaller companies disclose only abbreviated financial statements.
The full methodology in detail
Every formula, threshold and assumption behind the insolvency risk analysis is set out transparently on our blog.
Platform & export
In the profile and as a report.
The risk analysis lives where you work: right inside the company profile, and as a formatted PDF report for anyone who isn't on the platform.
In the company profile
The risk analysis is part of every company profile: all three scores with their underlying ratios, right alongside financials, shareholder structure and business model analysis.
Learn more about our dataAs a PDF company profile
Export the complete company profile as a formatted report: core company details, key financials, shareholder structure and the risk analysis with all three scores and their ratios. Ready for investment memos, credit decisions and the data room.
One click, one shareable document
Get ahead
Quantify risks before anyone else sees them.
The insolvency risk analysis turns annual accounts into a clear probability: for earlier outreach, sharper prioritisation and better-informed decisions.
