Brightstar Lottery PLC — financial distress indicators
Financial-health summary
Brightstar Lottery PLC's reported numbers place it in the 'Watch' financial-health band (distress score 38/100). The main indicators are market-implied default probability >20%, ohlson o-score signals likely failure and current liabilities exceed current assets. Independently, the Ohlson accounting model puts its 1-year failure probability at 67% and the market-implied (Merton) default probability is 21.4%. In its favour: high insider/promoter ownership (49%) aligns management with survival.
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.
Merton distance-to-default 0.79 σ → PD 21%.
Structural (Merton/KMV) model: equity is a call option on assets; low distance-to-default means assets are close to the default point.
O-score 0.73 → model probability 67%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Current ratio is 0.88.
Short-term obligations exceed short-term resources — the company relies on rolling over credit.
Revenue declined every year for three years.
Structural, not cyclical, decline.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- High insider/promoter ownership (49%) aligns management with survival.
📰 Recent news scan
- BRSL Nov 2026 10.000 call (BRSL261120C00010000) interactive stock chart – Yahoo Finance - Yahoo Finance SingaporeGoogle News · 2026-10-22
- A 357,600-share buyback taps the $500M program at Brightstar Lottery (BRSL). - Stock TitanGoogle News · 2026-10-22
- Brightstar Lottery extends its key contract with New York state (BRSL:NYSE) - Seeking AlphaGoogle News · 2026-10-20
- Brightstar Lottery (NYSE:BRSL) Stock Price Target Lowered at Truist Financial - MarketBeatGoogle News · 2026-10-20
- Truist Financial Maintains Brightstar Lottery(BRSL.US) With Hold Rating, Announces Target Price $11 - MoomooGoogle News · 2026-10-20
- BRSL Stock 12‑Month Price Target Cut to $16.24, Implies 59% Upside - TradingViewGoogle News · 2026-10-07
⚖️ 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 Brightstar Lottery PLC's financial-health indicators show?
As of 2026-10-23, Brightstar Lottery PLC's public financial data places it in the 'Watch' band with a distress score of 38/100, driven by market-implied default probability >20%, ohlson o-score signals likely failure and current liabilities exceed current assets. 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 Brightstar Lottery PLC's financial distress score?
38/100 ('Watch'). Ohlson O-score 0.73 (model 1-year failure probability 67%). Merton distance-to-default 0.79 σ (model default probability 21.4%).
What works in Brightstar Lottery PLC's favour?
High insider/promoter ownership (49%) aligns management with survival.
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.
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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.