FinScore and MarketScore – How YC.Market superpowers work
YC.Market combines the most effective tools for market research and b2b customer search. Adequate competitive analysis and business intelligence are only possible with a systematic study and assessment of the company's financial sustainability and its position in the market. In YC.Market reports these parameters reflect FinScore and MarketScore indicators. They are calculated by converting financial scores into indicators.
Assessment of a company's financial sustainability – FinScore
FinScore is an index of a company's financial sustainability based on its economic indicators. With its help, it is possible to predict the probability of company bankruptcy.
The FinScore index is based on 20 financial indicators that comprehensively show the state of liquidity, solvency, profitability and business activity of the company.
Thanks to the combination of machine learning, neural networks, logistic regression modelling and financial analysis, the FinScore index from year to year confirms its high ability to predict the probability of company bankruptcy.
FinScore index reflects the relative level of financial sustainability within the market and corresponds to a particular letter of the alphabet:
- A (High level)
- B (Good level)
- C (Satisfactory level)
- D (Unsatisfactory level).
The index also contains numerical values – points from 1 (minimum financial sustainability) to 4 (maximum financial sustainability), depending on the values of the company’s financial indicators. Numerical values reveal the FinScore index in more detail. This information is available in the YouControl system.
The risk indicators and scoring algorithms used in calculating this index demonstrate the maximum predictive ability to assess a company’s financial condition. Currently, the indicators are as follows:
- Current Ratio
- Cash Ratio
- Acid-test Ratio
- Quick Ratio
- Net Quick Ratio
- Net Debt / EBITDA
- Equity to Fixed Assets Ratio
- Return on Equity
- RCA - Return on Current Assets
- NPM - Net Profit Margin
- ROTA - Return on Total Assets
- Gross Profit Markup
- Berry Ratio
- Return on Total Costs
- Business activity
- Total Assets Turnover
- Working Capital Turnover
- Receivables Turnover
According to our analysis, companies with poorer values of these indicators went bankrupt more often than their competitors from 2011 to 2020. You can focus on FinScore indicators in choosing counterparties and planning. Moreover, the YouControl system considers companies' financial statements for 2021 – this is exclusive data that makes the analysis as accurate as possible.
Assessment of market power – MarketScore
MarketScore is a scoring index of the company’s market power, calculated by the analytical department of YouControl. It is based on 10 ratios that reflect the company’s market share, position in the industry and growth dynamics compared to its competitors. This index describes a company’s market power compared to other companies in a particular industry.
The range of MarketScore values may vary from 1 – minimum market power to 4 – maximum market power, depending on the combination of the company’s economic indicators. After the calculation of the market share for each company, it is assigned a specific score:
- More than 10% of the market ㅡ 4 points
- 5% – 10% of the market ㅡ 3 points
- 0.3% – 5% of the market ㅡ 2 points
- From 0.3% of the market ㅡ 1 point.
The A-B-C-D indicator is assigned to companies using the same algorithm. Similarly, points are calculated for 9 more parameters: the company’s market share, its rank in the market, and growth dynamics compared with competitors and others. And the arithmetic mean of all parameters is the final MarketScore index.
The purpose of the MarketScore calculation is an express analysis of a company’s market power that helps users understand its partner company’s size against other market players. Please note that this index shows only the size of a company and says nothing about its trustworthiness, so it shouldn’t be relied upon instead of a credit rating or financial risk index.
MarketScore cannot help predict bankruptcy since a company’s solvency doesn’t depend on its revenues.
Check in the sanctions lists
YC.Market checks whether the counterparty, related individuals and legal entities are under sanctions. Verification is required because sanctioned companies have restrictions that may affect the company as follows:
- Blocking of assets
- Restriction on trade operations
- Suspension of economic and financial obligations
- Revocation or suspension of licenses and other permits.
russia's military invasion of Ukraine has further complicated the business environment worldwide. The sanctions that various countries have imposed on the russian federation to protect their citizens and businesses should be considered when cooperating with new partners, concluding contracts and developing new markets.
Additionally, to check the sanctions, we recommend to use RuAssets
RuAssets – a unique tool for searching and identifying russian and belarusian assets, connections of legal entities and individuals with russian and belarusian assets, PEPs and sanctioned persons. It is a complete system for identifying beneficiaries and owners in more than 26 countries.
The verification is carried out according to 8 sanctions lists:
- Sanctions of the National Security and Defense Council of Ukraine
- All sanctions lists administered by OFAC of the United States Department of the Treasury
- Sanctions list of Canada
- Sanctions List of EU
- Consolidated Sanctions List of Australia
- Sanctions List of the United Kingdom
- Sanctions List of Japan against the Russian Federation in Connection with the Events in Ukraine
- Sanctions Lists by the Bureau of Industry and Security (BIS) of the U.S. Department of Commerce.
- YC.Market is a complete source of open data on Ukrainian companies for making informed management decisions.
- 28 company search criteria, 8 sorting options for convenient and fast work with the tool.
- The YouControl team has the most incredible experience and expertise since it has been collecting and processing open data for the safety and success of your business for 8+ years.
- 7.5 million companies and individual entrepreneurs in Ukraine are in our data lists that you can use.
Get unhindered access to data for operational market analysis in Ukraine and the UK to analyse the market, find new customers, partners and suppliers and make strategic decisions based on the data.