A Z-score is a statistical metric used to evaluate a company’s financial health and predict bankruptcy risk. Developed by economist Edward Altman, the Z-score combines several financial ratios to assess credit risk, offering insights into a company’s stability. A high Z-score indicates low risk of bankruptcy, while a low score suggests financial distress. Z-scores are valuable in credit analysis, allowing investors and analysts to make informed decisions by evaluating the likelihood of a company’s financial survival, especially in uncertain markets.