The purpose of this paper is to analyse the main variables distinguishing between high-growth firms and non-high-growth firms in the Italian manufacturing market. Specifically, we aim to establish which balance-sheet ratios enable us to distinguish between high-growth and non-high-growth firms. For this purpose, we employed a discriminant analysis on the financial data of two groups of firms selected from a population of approximately 22,000 firms. The results of the analysis indicate the roles of firm size, non-financial debt and internal cash flows in the growth and success of a firm. We adopt an innovative approach that considers financial statements issued the year prior to the observation of accelerated growth as predictive of this growth (as is used by credit-scoring models, i.e., the Z-Score model, to measure the probability of default).

Predicting Rapid-Growth SMEs through a Reversal of Credit-Scoring Principles: A Note

SAMPAGNARO, GABRIELE
2013

Abstract

The purpose of this paper is to analyse the main variables distinguishing between high-growth firms and non-high-growth firms in the Italian manufacturing market. Specifically, we aim to establish which balance-sheet ratios enable us to distinguish between high-growth and non-high-growth firms. For this purpose, we employed a discriminant analysis on the financial data of two groups of firms selected from a population of approximately 22,000 firms. The results of the analysis indicate the roles of firm size, non-financial debt and internal cash flows in the growth and success of a firm. We adopt an innovative approach that considers financial statements issued the year prior to the observation of accelerated growth as predictive of this growth (as is used by credit-scoring models, i.e., the Z-Score model, to measure the probability of default).
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Utilizza questo identificativo per citare o creare un link a questo documento: http://hdl.handle.net/11367/18337
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