Roadrunner Transportation Systems, Inc. generates more than $2 billion in annual sales – yet in a growing trucking industry, CreditRiskMonitor subscriber crowdsourcing provides us a key warning signal that the company may be headed towards a breakdown.
Roadrunner Transportation Systems, Inc. (Nasdaq: RRTS), an asset-light transportation and logistics service provider based out of Wisconsin, is currently battling financial distress. Since May 2018, Roadrunner Transportation Systems, Inc. has dropped as far as a company can go into the FRISK® score "red zone" to a bottom-rung "1." This high-risk signal indicates a 10-to-50% probability of bankruptcy over the coming 12-month period.
In this High Risk Report, we demonstrate key factors that are contributing to Roadrunner Transportation Systems, Inc.'s weakening financial condition. For instance, the business has reported net losses in each of the last five sequential quarters, in addition to bottom quartile rankings among industry peers for key financial ratios such as cash, total debt-to-equity, total debt-to-assets and interest coverage.
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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.
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About High Risk Reports
Our High Risk Reports feature companies that are exhibiting a significantly high level of financial distress, as indicated by our proprietary FRISK® score.
The reports highlight the factors that have pushed a company's score lower on the "1" (worst) to "10" (best) FRISK® score, which is 96% accurate in predicting bankruptcy over a 12-month period. The High Risk Reports also includes analysis on financial indicators such as the company’s DBT index, stock performance, financial ratios and how it is performing relative to its industry peers.
The ultimate goal of the High Risk Report series is two-part: provide an early warning for those doing business with an increasingly distressed company and inform of the many signals that should be examined when assessing financial risks.