Bally's Corporation — financial distress indicators
Financial-health summary
Bally's Corporation's reported numbers place it in the 'Weak' financial-health band (distress score 64/100). The main indicators are operating profit does not cover interest, losses in each of the last 3 years and very high leverage. Independently, the Ohlson accounting model puts its 1-year failure probability at 71% and the market-implied (Merton) default probability is 11.2%.
Stress by dimension
Share price — last 12 months
Indicators behind the score
Each red flag shows the evidence from the company’s own filings and the financial or legal principle behind it. Points add to the 0–100 score.
Interest coverage (EBIT / interest) is -0.96×.
When EBIT < interest, debt service is funded from cash reserves or new borrowing — the classic precursor to payment default and covenant breach.
Net income negative in 3 of 3 fiscal years.
Persistent losses erode equity and the capacity to absorb shocks.
Total debt is 58.5× EBITDA.
Debt above ~6× EBITDA is deep sub-investment-grade territory; refinancing becomes difficult when rates or earnings move against the company.
O-score 0.88 → model probability 71%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Merton distance-to-default 1.21 σ → PD 11.2%.
Investment-grade issuers typically have 1-year PD well below 1%.
Operating margin fell from 4% to -11% in two years.
Sharp margin compression signals loss of pricing power or cost control.
1 severe and 0 moderate distress-related headlines in the last 6 months.
Headlines are corroborating evidence only; they are weighted lightly and never drive a flag alone.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- No material mitigating factors found in the available data.
📰 Recent news scan
- going concernBally’s (BALY)’s Casino Building Spree Triggers a ‘Going Concern’ WarningYahoo Finance · 2026-09-20
- WhiteHawk Capital Partners Leads $560 Million Financing to Support Bally’s Bronx DevelopmentYahoo Finance · 2026-10-08
- Bally’s Corporation Closes Previously Announced Financing to Support the Development of the Bally’s Bronx ProjectYahoo Finance · 2026-10-02
- 3 Reasons BALY is Risky and 1 Stock to Buy InsteadYahoo Finance · 2026-09-30
- 1 Stock Under $50 with Exciting Potential and 2 We Brush OffYahoo Finance · 2026-09-25
- A Look Back at Consumer Discretionary - Casino Operator Stocks’ Q1 Earnings: Bally's (NYSE:BALY) Vs The Rest Of The PackYahoo Finance · 2026-09-23
⚖️ U.S. legal pathway — Title 11, U.S. Code
Which chapter would apply?
- Chapter 11 — reorganisation. Management usually stays in control as debtor-in-possession; the automatic stay (§362) halts collection; a plan must meet the best-interests test (§1129(a)(7)) and the absolute priority rule (§1129(b)) — creditors are paid before shareholders, who are frequently wiped out.
- Chapter 7 — liquidation. A trustee sells assets and distributes proceeds by statutory priority (§§507, 726).
- Subchapter V (“Chapter 5”) is a fast track for small-business debtors under a statutory debt cap, but SEC-reporting companies are excluded (§101(51D)) — so it rarely applies to listed companies.
What typically triggers a filing
- Payment default or covenant breach lenders will not waive; a debt maturity that cannot be refinanced.
- Auditor going-concern doubt (ASC 205-40 / PCAOB AS 2415) — often itself a default trigger in loan agreements.
- Creditors can force a case with an involuntary petition (§303) if debts are not paid as they come due.
- Delisting after sustained sub-$1 prices or equity deficits cuts off equity funding.
Transactions shortly before filing can be clawed back (preferences — 90 days, §547; fraudulent transfers — 2 years, §548).
Frequently asked questions
What do Bally's Corporation's financial-health indicators show?
As of 2026-10-08, Bally's Corporation's public financial data places it in the 'Weak' band with a distress score of 64/100, driven by operating profit does not cover interest, losses in each of the last 3 years and very high leverage. This is a statistical screen of reported numbers — it does not mean the company is insolvent, has defaulted or will enter insolvency proceedings.
What is Bally's Corporation's financial distress score?
64/100 ('Weak'). Ohlson O-score 0.88 (model 1-year failure probability 71%). Merton distance-to-default 1.21 σ (model default probability 11.2%).
What works in Bally's Corporation's favour?
No material mitigating factors were found in the available data.
How are shareholders treated if a company enters insolvency?
In a Chapter 11 reorganisation the absolute priority rule pays secured lenders, then unsecured creditors, before shareholders — so existing shares are usually cancelled or heavily diluted. In Chapter 7 the company is liquidated and shareholders rarely recover anything.
Other Consumer Discretionary companies with distress indicators
- AIIO (AIIO)Very weak 100/100
- ECARX Holdings Inc. (ECX)Very weak 100/100
- Polestar Automotive Holding UK PLC (PSNY)Very weak 100/100
- Polestar Automotive Holding UK PLC (PSNYW)Very weak 100/100
- Reborn Coffee, Inc. (REBN)Very weak 100/100
- Sports Entertainment Gaming Global Corporation (SEGG)Very weak 100/100
All Consumer Discretionary companies with distress indicators →
Methodology
Score = capped sum of rule-based red flags across seven dimensions (liquidity, solvency, profitability, cash flow, sales trend, market signal, news). Ohlson O-score (1980) gives an accounting-based 1-year failure probability; Merton distance-to-default (Bharath & Shumway 2008) gives a market-implied probability. Financial institutions use a capital-based rule set. Recalculated every trading day from the latest filings, prices and news.