NEW YORK (TheStreet) -- The media sector is riddled with risk.
Highly dependent on advertising revenue, the industry has been attempting to figure out how to compete in a world where content is increasingly being accessed online. This has put pressure on most of the stocks and raised fears of Chapter 11 filings.
One way to test if a company poses any threat of filing for bankruptcy is through the Altman Z-Score, a formula developed by New York University professor Edward Altman in 1968. The Altman Z-Score measures several aspects of a company's financial health to forecast the probability of it going bankrupt within two years. Since its inception, the formula has been 72% accurate in predicting corporate bankruptcies two years prior to the filing.
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