A dark and dirty descent into bankruptcy was the story of Cloud Peak Energy Inc., as America's coal industry continues to hover in a volatile space.
Based in Wyoming's Powder River Basin, Cloud Peak made news in March by skipping a $1.8 million interest payment, triggering talks of the need for Chapter 11 protection. As of Dec. 31, the company's Cloud Peak Energy Resources LLC subsidiary owed $56.4 on 2024 bonds and $290.4 million on second-lien debt maturing in 2021, according to a fling with the U.S. Securities and Exchange Commission.
Our proprietary FRISK® score was able to capture Cloud Peak's drop into the "red zone" of risk starting in the summer of 2018, giving creditors a competitive advantage to pivot away from this counterparty months before scary headlines arrived:
In this High Risk Report, we take a look at additional factors which caused Cloud Peak to crumble, including their intense decrease in working capital and unfavorable rates of return in late 2018 and 2019.
Download the free report to learn more.
Our FRISK® score model incorporates four powerful risk inputs:
- “Merton”-type model of stock market capitalization and volatility
- Financial ratios, including those used in the Altman Z”-Score Model
- Bond agency ratings from Fitch, Moody's, and DBRS Morningstar
- Website click pattern data from CreditRiskMonitor® subscribers, representing key credit decision-makers at nearly 40% of current Fortune 1000 companies plus thousands of other large companies worldwide
Since the start of 2017, the FRISK® score’s rate of success in capturing public company bankruptcy is 96%. In any given year, you can count on one hand the times we miss – and in those outlier cases, the circumstances deal with unusual, unforeseen events such as natural disasters and CEO fraud.
Download the free report to learn more.
About Bankruptcy Case Studies
CreditRiskMonitor® Bankruptcy Case Studies provide post-filing analyses of public company bankruptcies. Our case studies educate subscribers about methods they can apply to assess bankruptcy risk using our proprietary FRISK® score, robust financial database, and timely news alerts.
In nearly every case, a low FRISK® score gave our subscribers early warning of financial distress within a one-year time horizon. Our proprietary FRISK® score predicts bankruptcy risk at public companies with 96% accuracy. The score is formulated by a number of indicators including stock market capitalization and volatility, financial ratios, bond agency ratings from Moody’s, Fitch and DBRS, and crowdsourced behavioral data from a subscriber group that includes nearly 40% of the Fortune 1000 and thousands more worldwide.
Whether you are new to credit analysis or have decades of experience under your belt, CreditRiskMonitor® Bankruptcy Case Studies offer unique insights into the business and financial decline that precedes bankruptcy.