PAVS — financial distress indicators
Financial-health summary
PAVS's reported numbers place it in the 'Weak' financial-health band (distress score 59/100). The main indicators are market-implied default probability >20%, losses in each of the last 3 years and operations consume cash. Independently, the Ohlson accounting model puts its 1-year failure probability at 45% and the market-implied (Merton) default probability is 90.3%. In its favour: cash on hand covers all debt (net-cash balance sheet).
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 -1.30 σ → PD 90%.
Structural (Merton/KMV) model: equity is a call option on assets; low distance-to-default means assets are close to the default point.
Net income negative in 3 of 3 fiscal years.
Persistent losses erode equity and the capacity to absorb shocks.
Operating cash flow negative in 3 of the last 3 years.
A business that cannot fund itself from operations depends on external capital to survive.
Price is -100% from its 52-week high.
Equity markets price distress early; collapses of this size usually reflect fear of wipe-out in a restructuring.
Share count up +928% in a year.
Survival financing: repeated equity raises at depressed prices.
0 severe and 1 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
- Cash on hand covers all debt (net-cash balance sheet).
- Strong current ratio (8.18).
- Revenue still growing (+20311% YoY).
📰 Recent news scan
- dilutBTCT, CTNT, PAVS: Why These Stocks Posted Double-Digit Gains After-Hours TodayYahoo Finance · 2026-06-30
- PAVS Stock’s Second Reverse Split Announcement This Year Sends It To Record Lows – A Look At The Latest ConsolidationYahoo Finance · 2026-06-25
- Paranovus Entertainment Technology Limited Signs Non-Binding Letter of Intent to Acquire Jabanero Inc.Yahoo Finance · 2026-06-15
- PAVS Announces Pricing of a $10 Million Registered Direct Offering of Class A Ordinary Shares and Pre-Funded WarrantsYahoo Finance · 2026-06-15
- PAVS Stock Heads For Best Day Since Implementing Reverse Share Split In March – What’s Driving Today’s Super Rally?Yahoo Finance · 2026-06-15
- PAVS Announces Termination of the Sales Agreement for its At-the-Market Offering with AC Sunshine SecuritiesYahoo Finance · 2026-06-15
⚖️ 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 PAVS's financial-health indicators show?
As of 2026-10-08, PAVS's public financial data places it in the 'Weak' band with a distress score of 59/100, driven by market-implied default probability >20%, losses in each of the last 3 years and operations consume cash. 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 PAVS's financial distress score?
59/100 ('Weak'). Ohlson O-score -0.22 (model 1-year failure probability 45%). Merton distance-to-default -1.3 σ (model default probability 90.3%).
What works in PAVS's favour?
Cash on hand covers all debt (net-cash balance sheet). Strong current ratio (8.18). Revenue still growing (+20311% 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 Unclassified companies with distress indicators
- CNEY (CNEY)Very weak 100/100
- EPOW (EPOW)Very weak 100/100
- GIBO (GIBO)Very weak 100/100
- GNS (GNS)Very weak 100/100
- HKPD (HKPD)Very weak 100/100
- HUBC (HUBC)Very weak 100/100
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.