Oddity Tech Ltd. — financial distress indicators
Financial-health summary
Oddity Tech Ltd.'s reported numbers place it in the 'Watch' financial-health band (distress score 41/100). The main indicators are market-implied default probability >20%, very high leverage and ohlson o-score signals likely failure. Independently, the Ohlson accounting model puts its 1-year failure probability at 54% and the market-implied (Merton) default probability is 43.5%. In its favour: strong current ratio (4.06).
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 0.16 σ → PD 43%.
Structural (Merton/KMV) model: equity is a call option on assets; low distance-to-default means assets are close to the default point.
Total debt is 9.4× EBITDA.
Debt above ~6× EBITDA is deep sub-investment-grade territory; refinancing becomes difficult when rates or earnings move against the company.
O-score 0.17 → model probability 54%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Price is -69% from its 52-week high.
For financial firms a share-price run often precedes a deposit or funding run (confidence channel).
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Strong current ratio (4.06).
- Revenue still growing (+25% YoY).
📰 Recent news scan
- Oddity Tech (ODD) Stock Gets Fair Value Boost After Analysts Raised TargetsYahoo Finance · 2026-10-02
- Oddity Tech’s Revenue Fell 25%. Is the IL MAKIAGE Advertising Fix Working?Yahoo Finance · 2026-09-16
- Earnings Estimates Moving Higher for Oddity Tech (ODD): Time to Buy?Yahoo Finance · 2026-09-15
- Oddity Tech (ODD) Q2 2026 Earnings Call TranscriptYahoo Finance · 2026-09-10
- Why Oddity Tech's Stock Skyrocketed 26.5% TodayYahoo Finance · 2026-09-09
- ODDITY Tech Ltd (ODD) (Q2 2026) Earnings Call Highlights: Revenue Declines 25% as IL MAKIAGE ...Yahoo Finance · 2026-09-09
⚖️ 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 Oddity Tech Ltd.'s financial-health indicators show?
As of 2026-10-08, Oddity Tech Ltd.'s public financial data places it in the 'Watch' band with a distress score of 41/100, driven by market-implied default probability >20%, very high leverage and ohlson o-score signals likely failure. 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 Oddity Tech Ltd.'s financial distress score?
41/100 ('Watch'). Ohlson O-score 0.17 (model 1-year failure probability 54%). Merton distance-to-default 0.16 σ (model default probability 43.5%).
What works in Oddity Tech Ltd.'s favour?
Strong current ratio (4.06). Revenue still growing (+25% YoY).
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 Staples companies with distress indicators
- AMASS Brands, Inc. (AMSS)Very weak 100/100
- Borealis Foods Inc. (BRLS)Very weak 100/100
- Reed's, Inc. (REED)Very weak 100/100
- Sadot Group Inc. (SDOT)Very weak 100/100
- Rocky Mountain Chocolate Factory, Inc. (RMCF)Very weak 97/100
- Sow Good Inc. (SOWG)Very weak 97/100
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.