LG Display Co., Ltd. — financial distress indicators
Financial-health summary
LG Display Co., Ltd.'s reported numbers place it in the 'Weak' financial-health band (distress score 52/100). The main indicators are operating profit does not cover interest, market-implied default probability >20% and current liabilities exceed current assets. Independently, the Ohlson accounting model puts its 1-year failure probability at 2% and the market-implied (Merton) default probability is 98.9%. In its favour: operating cash flow is positive over the latest 12 months.
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 0.97×.
When EBIT < interest, debt service is funded from cash reserves or new borrowing — the classic precursor to payment default and covenant breach.
Merton distance-to-default -2.28 σ → PD 99%.
Structural (Merton/KMV) model: equity is a call option on assets; low distance-to-default means assets are close to the default point.
Current ratio is 0.74.
Short-term obligations exceed short-term resources — the company relies on rolling over credit.
Recurring net losses.
Repeated losses are a core input in both Ohlson and Altman failure models.
Short-term debt is 3.1× cash on hand.
Maturity wall: debt due within a year must be refinanced, which is the most common proximate cause of filings.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Operating cash flow is positive over the latest 12 months.
📰 Recent news scan
- Asian Equities Traded in the US as American Depositary Receipts Decline in Thursday TradingYahoo Finance · 2026-10-01
- Asian Equities Traded in the US as American Depositary Receipts Start Week Lower in Monday TradingYahoo Finance · 2026-09-28
- LG Display launches 24.5-inch 720Hz Gaming OLED PanelYahoo Finance · 2026-09-21
- Asian Equities Traded in the US as American Depositary Receipts Rise in Monday TradingYahoo Finance · 2026-09-21
- Asian Equities Traded in the US as American Depositary Receipts Edge Higher in Wednesday TradingYahoo Finance · 2026-08-19
- /C O R R E C T I O N -- LG Display/Yahoo Finance · 2026-08-19
⚖️ 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 LG Display Co., Ltd.'s financial-health indicators show?
As of 2026-10-08, LG Display Co., Ltd.'s public financial data places it in the 'Weak' band with a distress score of 52/100, driven by operating profit does not cover interest, market-implied default probability >20% 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 LG Display Co., Ltd.'s financial distress score?
52/100 ('Weak'). Ohlson O-score -3.7 (model 1-year failure probability 2%). Merton distance-to-default -2.28 σ (model default probability 98.9%).
What works in LG Display Co., Ltd.'s favour?
Operating cash flow is positive over the latest 12 months.
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 Hardware & Electronics companies with distress indicators
- Foxx Development Holdings Inc. (FOXX)Very weak 100/100
- Algorhythm Holdings, Inc. (RIME)Very weak 100/100
- USBC, Inc. (USBC)Very weak 100/100
- Telesat Corporation (TSAT)Very weak 79/100
- Q/C Technologies, Inc. (QCLS)Very weak 77/100
- Boxlight Corporation (BOXL)Very weak 76/100
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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.