How to Survive the 2024 Zombie Company Apocalypse 🧟‍♀️

Uncover how to identify zombie companies in 2024. Stay informed with our comprehensive financial ratio guide.

With interest rates having gone up fast, and looking like they will be high for longer, I thought you will be interested to see how many zombie companies we could find. With zombie companies I mean companies that may struggle to pay interest on their debt not even talking about repaying it.

Also, looking at the numbers below these companies are going to have a hard time to refinance their debt. This means bankruptcy, so please check if you have one or more in your portfolio!



The Zombie Company Stock Screen

This is what the zombie stock screen looks like:

  • All companies worldwide
  • Market value of more than $1 billion
  • Select the 50% of companies with the worst Net Debt to EBIT ratio
  • Piotroski F-Score of less than five
  • Financial statements updated recently - in the past six months
  • An External Finance ratio (Change in Assets - Cash from Operations) / Total Assets) greater than zero. This means a company was not able to finance their asset growth - from internally generated funds (cash from operations)


Click here to start finding your own zombie companies NOW!


Choose your own ratios

Before we get to the list of companies.

Remember, this is just a list of the best zombie finding ratios I came up with.

The stock screener has a LOT of other ratios you can use, for example:


You can find a full list and their description here: Glossary of ratios to find zombie companies


A list of terrible companies

As you can imagine this screen gives you list of companies in a horrible financial state.

You could of course use any debt or leverage ratio to sort the results to give you the worst zombie companies. I sorted this list using four different ratios to give you an idea what you can do with the screener.



Sorted by Leverage Ratio

Firstly, I sorted the screen from high to low by Leverage Ratio. The Leverage Ratio = Total debt / (Average Total Assets)

It is thus total debt to average total assets of the company over the past two years.


Here is the list:

Name Country Leverage Ratio
Wingstop Inc. USA 1.87
Triumph Group, Inc. USA 1.02
Herbalife Ltd. USA 1.00
Leslie's, Inc. USA 0.97
Ironwood Pharmaceuticals, Inc. USA 0.95
FTAI Aviation Ltd. USA 0.93
Philip Morris International Inc. USA 0.92
Gogo Inc. USA 0.91
Pet Valu Holdings Ltd. Canada 0.87
Iron Mountain Incorporated USA 0.87
Cimpress plc Ireland 0.86
Hess Midstream LP USA 0.85
Global Net Lease, Inc. USA 0.84
Bausch Health Companies Inc. Canada 0.84
Fuyo General Lease Co., Ltd. Japan 0.83
IONOS Group SE Germany 0.83
OUTFRONT Media Inc. USA 0.78
Altice USA, Inc. USA 0.78
Grindr Inc. USA 0.77
Hertz Global Holdings, Inc. USA 0.77



Sorted by Net Debt to EBIT

Next, I sorted the list from high to low by Net Debt to EBIT.

Net Debt to EBIT is equal to (Long-term debt + Short term debt – Cash) / Earnings before interest and taxes (EBIT).

This ratio shows you how able a company is to pay interest and capital on its debt. The smaller the ratio (means the company has a low amount of debt compared to EBIT) the healthier the company and the other way around.

For example, the highest value below is 530. This means that Net Debt equals 530 times EBIT or that EBIT only makes up 0.18% of Net Debt (1/530). With this level of EBIT this company cannot even make an interest payment of 1% or it will be loss making!


Here is the list:

Name Country Net Debt to EBIT Leverage Ratio
Resonac Holdings Corporation Japan 530.55 0.48
Qorvo, Inc. USA 454.21 0.29
The Macerich Company USA 386.45 0.58
Bayer Aktiengesellschaft Germany 370.08 0.38
Globalstar, Inc. USA 305.02 0.45
Covestro AG Germany 239.73 0.24
BayWa Aktiengesellschaft Germany 171.51 0.49
SL Green Realty Corp. USA 124.96 0.39
Healthcare Realty Trust Incorporated USA 93.39 0.41
Hines Global Income Trust, Inc. USA 90.77 0.40
Paramount Group, Inc. USA 83.89 0.45
Global Net Lease, Inc. USA 77.79 0.84
Capstone Copper Corp. Canada 77.58 0.19
Coca-Cola Bottlers Japan Holdings Inc. Japan 72.88 0.21
Kawasaki Heavy Industries, Ltd. Japan 69.60 0.35
Liberty Broadband Corporation USA 62.49 0.27
Kohl's Corporation USA 56.93 0.51
Hudson Pacific Properties, Inc. USA 55.40 0.53
SkyWest, Inc. USA 54.55 0.42
Cellnex Telecom, S.A. Spain 53.02 0.51


Click here to start finding your own zombie companies NOW!



Sort by Free Cash Flow to Debt

To see if the company generated enough cash to pay interest or repay debt, I sorted the results from low to high by Free Cash Flow (FCF) to Total Debt .

This ratio gives you an idea of how high the company's total debt is compared to its free cash flow (Cash from operations minus Capital expenditure).

The worse rated company with a value of -274 had negative free cash flow, not good news if they have to service debt.


Here is the list:

Name Country FCF to Debt Net Debt to EBIT Leverage Ratio
Day One Biopharmaceuticals, Inc. USA -274.33 2.14 0.00
MoonLake Immunotherapeutics Switzerland -248.70 8.89 0.00
Morphic Holding, Inc. USA -96.89 4.65 0.00
IDEAYA Biosciences, Inc. USA -55.50 3.92 0.00
Energy Fuels Inc. USA -49.70 3.83 0.00
Galapagos NV Belgium -38.00 25.08 0.00
Arcus Biosciences, Inc. USA -34.00 2.45 0.01
Disc Medicine, Inc. USA -33.38 4.82 0.01
Karuna Therapeutics, Inc. USA -22.80 2.95 0.01
Structure Therapeutics Inc. USA -18.40 2.38 0.02
Vaxcyte, Inc. USA -17.75 3.50 0.01
Xenon Pharmaceuticals Inc. Canada -13.62 2.53 0.02
Merus N.V. The Netherlands -11.76 2.31 0.03
Joby Aviation, Inc. USA -11.23 2.43 0.02
IonQ, Inc. USA -10.37 2.97 0.01
Pliant Therapeutics, Inc. USA -10.22 2.93 0.03
Ballard Power Systems Inc. Canada -8.49 4.84 0.02
Alpine Immune Sciences, Inc. USA -7.61 2.77 0.04
Kura Oncology, Inc. USA -6.73 2.82 0.04
Wonik Ips Co., Ltd South Korea -6.47 28.12 0.01



Sorted by Debt to Equity

To not leave out a classic debt ratio here we sorted the list from high to low using the Debt-to-Equity ratio. It equals Total Debt / Common Shareholders Equity.

As you can see the worst rated company has debt equal to over 53 times its equity!


Here is the list:

Name Country Debt to Equity FCF to Debt Net Debt to EBIT Leverage Ratio
Iron Mountain Incorporated USA 53.82 0.00 12.98 0.87
Brookfield Business Corporation USA 32.33 0.00 12.23 0.49
FTAI Aviation Ltd. USA 24.15 -0.12 6.51 0.93
Camping World Holdings, Inc. USA 23.53 0.02 11.12 0.77
Choice Hotels International, Inc. USA 20.79 0.16 3.23 0.68
Gogo Inc. USA 20.28 0.09 3.93 0.91
Atmus Filtration Technologies Inc. USA 17.44 0.33 2.27  
IHS Holding Limited Great Britain 16.18 0.09 10.22 0.70
Ardagh Metal Packaging S.A. Luxembourg 15.29 0.00 17.68 0.65
Hanesbrands Inc. USA 14.71 0.09 11.71 0.62
Pet Valu Holdings Ltd. Canada 14.35 0.09 4.23 0.87
Grindr Inc. USA 14.33 0.11 6.27 0.77
The AES Corporation USA 14.11 -0.14 10.77 0.68
Victoria's Secret & Co. USA 14.10 0.08 9.73 0.70
Sacyr, S.A. Spain 13.93 0.00 5.76 0.55
Brookfield Infrastructure Partners L.P. USA 8.85 0.03 12.41 0.56
Hess Midstream LP USA 8.57 0.20 3.92 0.85
OUTFRONT Media Inc. USA 7.53 0.03 16.96 0.78
BayWa Aktiengesellschaft Germany 6.67 0.00 171.51 0.49
Fuyo General Lease Co., Ltd. Japan 6.45 -0.05 47.56 0.83



Just the Starting Point

I am sure you know this already, a screen is just a starting point for your research. There may be a good reason a company on the list is not a zombie, but if it is on the list, it is a red flag that you should take a closer look at.


Wishing you profitable investing!


PS To start using ratios like this to screen out Zombies in your portfolio now – Click here

PPS It is so easy to get distracted and put things off, so why not sign up right now!


Click here to start finding your own zombie companies NOW!