What is meant by Z-Score?

A bankruptcy predictor based on the formula derived by Dr. Edward Altman.
According to the Altman model, a Z-Score of 3.0 or higher indicates that the company is most likely safe based on the financial data; a score below 1.8 means that the firm is probably headed for bankruptcy.
It is belived that the Z-Score has been shown to have 90% accuracy of prediction of bankruptcy in the first year of the forecast, and 80% accuracy in the second year.
So next time when you hear about Z-Score, remember Bankruptcy.