Using Accounting and Stock Market Price Data to Predict Financial Distress

Abstract

This study investigated accounting measures depended on CAMEL ratios to predict services sector distress. The study used five variables representing CAMEL ratio from (2010-2015). Researchers used stepwise method and moving average to predict prices in 2017. Result showed that there is no significant relationship between market stock price and CAMEL ratios. Other factors such as Internal (mismanagement or corruption) or external (political issues) are affecting financial performance. Predicted result showed that there might be (19-26) listed corporations' facing financial distress in 2017. Especially in transportation and tourism filed.

Keywords: CAMEL Ratios; Firms' Distress; predicting.