BOSTON (TheStreet) -- Small-cap stocks have enjoyed a tremendous rally since the March 2009 low, although the recent losing streak for equity markets has stoked fears that bankruptcy for some companies with share prices below $5 is imminent.There are few reliable ways of determining which companies are at a greater risk of going bankrupt than others. The Altman Z-score, a formula developed by New York University professor Edward Altman in 1968, is one of them.
10. PositiveID ( PSID) Company Profile: Formed after the 2009 merger of VeriChip and Steel Vault, PositiveID provides health- and security-identification tools to protect consumers and businesses. Altman Z-score: -33.47 Current Share Price: 34 cents (June 7) 2011 Return: -45% Current Ratio: 1.5, indicating that PositiveID should be able to meet its short-term liabilities with its current assets.
8. Cell Therapeutics ( CTICD) Company Profile: Cell Therapeutics is a biopharmaceutical company with a focus on oncology. Last month, TheStreet's Adam Feuerstein reported that the Food and Drug Administration had again rejected pixantrone, which is Cell Therapeutics' treatment for non-Hodgkin's lymphoma. Altman Z-score: -37.19 Current Share Price: $2.19 (June 7) 2011 Return: The stock is unchanged this year. Current Ratio: 1.20, indicating that Cell Therapeutics should be able to meet its short-term liabilities with its current assets.
6. TearLab ( TEAR) Company Profile: Formerly known as OccuLogix, TearLab is an ophthalmic-device company commercializing a proprietary in-vitro diagnostic-tear testing platform, the TearLab test for dry-eye disease. Altman Z-score: -49.68 Current Share Price: $2.20 (June 7) 2011 Return: 0.5% Current Ratio: 0.80, indicating that TearLab would have some trouble meeting its short-term liabilities with its current assets.
4. Asure Software ( ASUR) Company Profile: Asure Software is a workforce-management software company, previously known as Forgent Networks until the 2007 acquisition of iEmployee. The company has been in frequent patent disputes, including a 2007 case against Echostar ( SATS) in which a jury found that Forgent's patent was invalid. Before a 1-for-10 reverse stock split in December 2009, Asure shares traded as low as 25 cents. Altman Z-score: -61.94 Current Share Price: $2.81 (June 7) 2011 Return: -4% Current Ratio: 0.90, indicating that Asure would have some trouble meeting its short-term liabilities with its current assets.
2. SulphCo ( SUF) Company Profile: SulphCo has developed its proprietary Sonocracking technology, which uses ultrasonic sound waves as part of a desulfurization process of crude oil products. Altman Z-score: -115.40 Current Share Price: 6 cents (June 7) 2011 Return: -67% Current Ratio: 0.80, indicating that SulphCo may have trouble meeting its short-term liabilities with its current assets.