Open AccessAn Analysis of the Predictors of Financial Distress for Zimbabwe Listed Corporates
Author(s) -
Louisa Muparuri,
Victor Gumbo
Publication year - 2021
Publication title -
asian journal of probability and statistics
Language(s) - English
Resource type - Journals
ISSN - 2582-0230
DOI - 10.9734/ajpas/2021/v12i430291
Subject(s) - equity (law) , stock exchange , financial distress , business , distress , novelty , logistic regression , actuarial science , accounting , economics , finance , financial system , statistics , psychology , mathematics , social psychology , political science , law , psychotherapist
This study brings novelty to the area of corporate distress modelling in Zimbabwe by exploring company-specific indicators of corporate distress, unlike most of the previous studies, which used financial performance indicators. Using a binary logistic regression on a time series dataset collated between 2010 and 2017, this study establishes book value, book value per share, average debt to equity and equity per share as very signicant determinants of corporate distress on the Zimbabwe Stock Exchange (ZSE). Future studies incorporating artificial intelligence and a combination of both the traditional financial ratios and market-based indicators is recommended to expand the scope of the study.