Stocks & Investing · How to use
Financial Health Traffic Light
Follow the steps to enter your numbers and check the limits.
Updated 2026-10-25 · ThinkVault Tools
Get started in three steps
- 1
Step 1
Prepare your amounts, terms and applicable rates or prices.
- 2
Step 2
Open the tool, check the units and compare scenarios.
- 3
Step 3
Read the results and notes. Check official documents and sources before deciding.
Method and common questions
Which four dimensions does the health card check?
The traffic-light card condenses balance-sheet and income-statement metrics into four signals: Cash Runway (months of operating cash), Altman Z solvency score, 3-year share dilution CAGR and 4-quarter gross-margin slope, rated Green, Amber or Red.
How to read each financial signal
Cash runway measures how many months cash reserves cover operating burn; Altman Z combines working capital, retained earnings and leverage to gauge distress risk; dilution tracks share-count expansion; margin slope tracks profitability momentum.
Financial data and model limitations
- Scores require complete statements matching the ticker, with provider and fiscal period shown. Missing data or an unconfigured provider never produces a fictitious score.
- Healthy thresholds vary widely across sectors such as banking, utilities, hardware and SaaS.
- Always verify financial ratios against official audited annual and quarterly filings before making decisions.
FAQ
- What does the Altman Z-Score measure?
- It is a composite credit-strength formula that weighs liquidity, cumulative profitability and leverage to flag potential balance-sheet stress.
- Why does share dilution matter to individual investors?
- If a company rapidly issues new shares, existing shareholders' ownership percentage and earnings per share (EPS) are diluted even if total revenue grows.
Method
Rule-based traffic-light grading across cash runway months, Altman Z″ score, 3-year share count CAGR and 4-quarter gross margin slope. Altman Z″ uses X4 = book equity ÷ total liabilities, never market capitalization.
Alpha Vantage — Financial statements APILast checked: 2026-10-24
Before you begin
Beta · Check provider financial indicators. Missing or mismatched statements produce no score.