Health · CheckEvery Warning Sign, One Score
Top: weekly price. Below: the number of shares, adjusted for stock splits, so the line only moves when shares are really added or bought back. Amber marks are filings that register or sell shares.
Insider trades
5%+ holders
Planned insider sales (Form 144)
Share-sale and warning filings
Short interest
Health Check in 30 seconds
About 30 yes-or-no checks, in eight groups, built from the company’s own SEC filings, insider trades and short-interest reports. Each check passes, warns or fails against a fixed rule shown next to it. The score adds them up. It tells you what to look into, not where the price goes.
Red flags
Going-concern doubt, weak internal controls, restated results, auditor changes, late reports, exchange listing notices and reverse splits. A critical one caps the score at 35.
Money
Debt (debt to equity, interest cover, net debt to earnings, debt due within a year, Altman Z-score), cash (current ratio, free cash flow or runway, dividend cover) and dilution (share count, stock pay, share-sale filings).
Business
Profitability and quality (margins, return on assets, profit backed by cash, the Piotroski F-score) and growth (revenue and profit against a year earlier).
People
Insiders and holders (open-market buying and selling, planned sales, activist stakes) and short interest (share of stock sold short, days to cover).
Exactly how the score is calculated
- Each check
- Passed = 2 points, warning = 1, failed = 0. Checks that cannot be run (data not reported) are left out rather than counted against the company.
- Group scores
- Points earned over points possible, 0 to 100.
- Overall score
- A weighted average of the groups: red flags 20, debt 18, cash 14, dilution 14, profitability 14, growth 8, insiders 6, short interest 6. Then three limits: 3 or more failed checks cap it at 64; one severe problem (cash under 12 months, negative equity, interest not covered by operating profit, or 25%+ dilution in a year) caps it at 45, two or more at 30; a critical red flag caps it at 35.
- Grades
- A 80 to 100, B 65 to 79, C 50 to 64, D 35 to 49, F under 35.
- Banks and insurers
- Debt, current ratio and cash-flow checks are skipped for banks, insurers and lenders, where borrowing and cash swings are the business; return on assets uses a 1% bar for them.
- Last 12 months
- Flows (sales, profit, cash flow, interest, dividends) are the last fiscal year plus this year so far, minus the same part of last year. Balance-sheet items are from the latest report.
- Piotroski F-score
- Nine tests comparing the last two fiscal years: profit, operating cash flow, rising return on assets, cash flow above profit, lower long-term debt, better current ratio, no new shares, higher gross margin and higher asset turnover. Scaled to 9 when one or two can’t be computed.
- Altman Z-score
- 1.2 × working capital/assets + 1.4 × retained earnings/assets + 3.3 × operating profit/assets + 0.6 × market value/liabilities + 1.0 × sales/assets. Designed for manufacturers.
- Sources
- SEC EDGAR (XBRL facts, filing index, Form 144, Schedules 13D/13G, full-text search), FINRA short interest, insider Form 4 trades. Updated at most twice a day per company.
- What we tested
- A seven-check version of this score (profit, debt load, short-term cover, share count, earnings backed by cash, positive equity, cash) was run every quarter from 2014 to 2025 on the SEC’s data as it stood at the time. Companies passing 6 or 7 checks beat other stocks of similar trading size by about 1.2% over the next year, mostly among mid-sized companies; among the largest it made no difference. The share-count check held up best: companies that grew their share count by more than 25% in a year did 4.6% worse than other large stocks over the next year. Free price histories leave out delisted companies, mostly weak ones, so these gaps are likely understated. The full score here has not been tested as a whole.
- What it is not
- A forecast or a buy list. It shows what to look into.
Good to know. Companies tag their filings differently, so a figure can be missing or off; every warning links back to the filing so you can check it. This is not a signal or advice to buy or sell.
For education only. Data comes from SEC filings, FINRA and third-party price sources and may be delayed or wrong. Past patterns do not predict future results, and nothing here is investment advice or a recommendation to buy, sell or hold anything. See the Terms and Disclaimer.