Team, Inc. — financial distress indicators
Financial-health summary
Team, Inc.'s reported numbers place it in the 'Very weak' financial-health band (distress score 72/100). The main indicators are liabilities exceed assets (negative equity), operating profit does not cover interest and losses in each of the last 3 years. Independently, the Ohlson accounting model puts its 1-year failure probability at 87% and the market-implied (Merton) default probability is 0.2%. 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.
Total liabilities are 1.08× total assets.
Balance-sheet insolvency test: debts exceeding the fair value of assets is the statutory definition of 'insolvent' in 11 U.S.C. §101(32).
Interest coverage (EBIT / interest) is 0.40×.
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 7.5× EBITDA.
Debt above ~6× EBITDA is deep sub-investment-grade territory; refinancing becomes difficult when rates or earnings move against the company.
Operating cash flow negative in 2 of the last 3 years.
A business that cannot fund itself from operations depends on external capital to survive.
O-score 1.86 → model probability 87%.
Ohlson (1980) logit model of 1-year corporate failure; O > 0 (p > 50%) is the original failure cut-off.
Revenue vs net income
Cash generation
Debt vs cash vs equity
✅ Mitigating factors
- Operating cash flow is positive over the latest 12 months.
- Strong current ratio (2.24).
📰 Recent news scan
- Discipline and Rules-Based Execution in TISI Response - Stock Traders DailyGoogle News · 2026-10-06
- Team Inc CFO Roeder buys $206,040 in common stock - Investing.comGoogle News · 2026-08-25
- Team Inc (TISI) director adds 500 shares in open-market buy - Stock TitanGoogle News · 2026-08-19
- Team Stock Jumps Despite Q2 Loss as Turnaround Work Is Deferred - TradingViewGoogle News · 2026-08-17
- Team (TISI) Stock Slides As Margin Squeeze Deepens Losses - Simply Wall StreetGoogle News · 2026-08-12
- Insider Purchase: Chief Executive Officer of $TISI Buys 5,800 Shares - Quiver QuantitativeGoogle News · 2026-05-21
⚖️ 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 Team, Inc.'s financial-health indicators show?
As of 2026-10-08, Team, Inc.'s public financial data places it in the 'Very weak' band with a distress score of 72/100, driven by liabilities exceed assets (negative equity), operating profit does not cover interest and losses in each of the last 3 years. 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 Team, Inc.'s financial distress score?
72/100 ('Very weak'). Ohlson O-score 1.86 (model 1-year failure probability 87%). Merton distance-to-default 2.9 σ (model default probability 0.2%).
What works in Team, Inc.'s favour?
Operating cash flow is positive over the latest 12 months. Strong current ratio (2.24).
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.