Likelihood that a Troubled Firm Will Fail

This model quantifies the probability of failure for troubled firms.

failurefinanceprobabilityrisktroubled firm

The user must define the following inputs:
- Coupon Rate
- Maturity of bond
- Riskfree rate
- Market price of bond

Note: this model is being shared with the authorization of Professor Aswath Damodaran from NYU Stern Business School (

This business tool includes
1 Excel Model

Prof. Aswath Damodaran offers you this business tool for free!

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Further information

- Probability of distress (Annual)
- Probability of distress over 5 years
- Probability of distress over 10 years


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