Predicción del fracaso empresarial utilizando métricas de flujo de efectivo

Translated title of the contribution: Predicting Business Failure Using Cash Flow Metrics

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Abstract

The purpose of this research is to examine the efficiency of cash flow metrics to forecast the probability of default of companies. Through a logistic regression model, the information of 58 companies with financial distress and 54 healthy companies had been analyzed for a period of 5 years. The results indicate that five of the ten metrics analyzed are efficient predictors of the probability of bankruptcy, with a correct prediction percentage of 87.73% of the cases. Similarly, it was determined that healthy companies and companies with financial difficulties have statistically different flow metrics from each other, so a greater use of cash flow metrics in financial analysis is recommended. The limitation of this study was to conform the sample of companies declared in default as of December 31, 2019. This research contributes to knowledge by demonstrating that cash flow metrics are a reliable tool in forecasting the probability serious financial problems in the context of Mexico. JEL Classification: M41 G3 G32 G33 C30 C39.

Translated title of the contributionPredicting Business Failure Using Cash Flow Metrics
Original languageSpanish
Article numbere729
Pages (from-to)1-22
Number of pages22
JournalRevista Mexicana de Economía y Finanzas (REMEF)
Volume18
Issue number3
DOIs
Publication statusPublished - 1 Jul 2023

Bibliographical note

Publisher Copyright:
© 2023 The Author(s).

All Science Journal Classification (ASJC) codes

  • Business, Management and Accounting(all)

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