Inovbiz : Jurnal Inovasi Bisnis
Vol 14 No 1 (2026): Edition June 2026

Early Detection of Financial Distress at PT. Garudafood Putra Putri Jaya Tbk Using Machine Learning Algorithms

Muhammad Bahanan (Politeknik Negeri Jember)
Mas’ud Hermansyah (Politeknik Negeri Jember)
Lukman Hakim (Politeknik Negeri Jember)
Hardian Dwi Utomo (Universitas PGRI Banyuwangi)



Article Info

Publish Date
01 Jun 2026

Abstract

This study aims to develop an early warning system to detect potential financial distress at PT Garudafood Putra Putri Jaya Tbk using Machine Learning (ML) algorithms. A quantitative case study approach was applied using the company’s publicly available quarterly financial reports from 2019 to 2024. Five ML algorithms were tested: Logistic Regression, Random Forest, Naive Bayes, K-Nearest Neighbors (KNN), and Support Vector Machine (SVM). The Random Forest algorithm achieved the highest accuracy of 85.71%, with a precision of 100%, recall of 66.67%, and an F1-score of 80%. Operating Profit Margin and Debt to Asset Ratio were identified as the most significant indicators in detecting financial distress. The proposed model can serve as a decision-support tool for management, investors, and regulators to proactively anticipate financial problems and reduce bankruptcy risk through early intervention. Keywords: Abstract, aim, scope, result

Copyrights © 2026






Journal Info

Abbrev

IPB

Publisher

Subject

Description

Jurnal Inovasi Bisnis (Inovbiz) focuses on how we gain knowledge through innovation and how knowledge encourages the innovation both in economics and business. It is provided for writer, researcher, professor, and practitioner who want to publish their research reports or articles, theoritical or ...