Shariah Compliance Risk — Logistic Regression Model

Per-company probability of Shariah non-compliance modelled from AAOIFI financial ratios via IRLS logistic regression with bootstrap inference.

Methodology IRLS logistic regression + nonparametric bootstrap (B=2000) Data source US Equities Shariah Screen (AAOIFI Std 21, yfinance) Universe S&P 500 Coverage 393/503 Last updated 2026-05-15

393

Companies modelled

137

High compliance risk ≥70%

0.988

Model AUC (95% CI)

0.797

McFadden R²

Model diagnostics

AUC

0.9876

95% CI [0.9841, 0.9877]

McFadden R²

0.7970

vs null (intercept-only) model

Brier score

0.0419

Mean squared probability error

LR statistic

418.8

χ²(3), p ≈ 0

Base rate

38.9%

153 of 393 non-compliant

Bootstrap reps

2,000

Nonparametric, with replacement

Coefficient estimates

All predictors standardised (zero mean, unit variance). Coefficients represent the change in log-odds of non-compliance per 1-SD increase.

Variable	β̂ MLE	SE (MLE)	z	p		Odds ratio	95% Boot CI
Intercept	1.314	0.347	3.79	<0.001	***	3.373	[2.242, 9.336]
Debt / Mkt Cap	9.251	1.463	6.32	<0.001	***	4071.318	[1030.746, 5615850.477]
Interest / Revenue	4.729	0.783	6.04	<0.001	***	79.295	[38.868, 1387.647]
Receivables / Mkt Cap	1.157	0.416	2.78	0.005	**	3.266	[0.943, 10.737]

*** p<0.001 ** p<0.01 * p<0.05 † p<0.10

Bootstrap vs standard-error comparison

SE Ratio = SE_boot / SE_MLE. Ratios deviating from 1 indicate where normal-theory asymptotics are inaccurate given the ~400-observation sample.

Variable	β̂ MLE	95% CI (standard)	β̂_BC	95% CI (bootstrap)	SE ratio
Intercept	1.314	[0.635, 1.994]	1.216	[0.807, 2.234]	1.05
Debt / Mkt Cap	9.251	[6.382, 12.119]	8.312	[6.938, 15.541]	1.52
Interest / Revenue	4.729	[3.195, 6.263]	4.373	[3.660, 7.235]	1.18
Receivables / Mkt Cap	1.157	[0.342, 1.973]	1.184	[-0.058, 2.374]	1.49

Odds ratios — per 1-SD increase (95% bootstrap CI)

A ratio >1 means the predictor increases non-compliance probability; <1 decreases it.

Coloured red = p < 0.05 (statistically significant). CIs from 2 000 nonparametric bootstrap replicates.

Distribution of predicted compliance risk

Model-estimated P(non-compliant) across 393 S&P 500 companies.

The bimodal pattern reflects the AAOIFI thresholds: most companies fall clearly on one side of the boundary, with a thin uncertainty band in the middle.

Mean compliance risk by sector

Average predicted P(non-compliant) per GICS sector. Red dashed = 50% threshold.

Risk tier distribution

Companies binned by predicted compliance-risk probability.

137

High

≥ 70% risk

Elevated

45–70% risk

Moderate

20–45% risk

219

Low

< 20% risk

Bimodal structure: most S&P 500 names resolve firmly as high- or low-risk. The 37 elevated/moderate companies sit in the AAOIFI boundary zone where ratio proximity to thresholds drives meaningful uncertainty.

393 companies

Company	Sector	Risk prob.	Tier	Debt/Mkt	Int./Rev.	Recv./Mkt	Actual
AEE Ameren	Utilities	100.0% [100–100]	high	65.4%	8.8%	2.2%	Excluded
AEP American Electric Power	Utilities	100.0% [100–100]	high	70.8%	9.3%	4.2%	Excluded
AES AES Corporation	Utilities	100.0% [100–100]	high	289.9%	11.5%	16.3%	Excluded
AMCR Amcor	Materials	100.0% [100–100]	high	84.1%	2.6%	19.2%	Excluded
AMT American Tower	Real Estate	100.0% [100–100]	high	56.6%	12.8%	1.1%	Excluded
ARE Alexandria Real Estate Equities	Real Estate	100.0% [100–100]	high	158.6%	7.7%	4.0%	Excluded
AWK American Water Works	Utilities	100.0% [100–100]	high	64.7%	12.0%	6.6%	Excluded
BAX Baxter International	Health Care	100.0% [100–100]	high	106.5%	2.6%	21.0%	Excluded
BXP BXP, Inc.	Real Estate	100.0% [100–100]	high	165.1%	18.8%	16.0%	Excluded
CAG Conagra Brands	Consumer Staples	100.0% [100–100]	high	123.4%	3.6%	11.8%	Excluded
CCI Crown Castle	Real Estate	100.0% [100–100]	high	77.6%	22.1%	0.9%	Excluded
CHTR Charter Communications	Communication Services	100.0% [100–100]	high	464.8%	9.2%	17.6%	Excluded
CMCSA Comcast	Communication Services	100.0% [100–100]	high	110.0%	3.6%	15.4%	Excluded
CMS CMS Energy	Utilities	100.0% [100–100]	high	83.5%	9.3%	5.9%	Excluded
CNC Centene Corporation	Health Care	100.0% [100–100]	high	62.7%	0.4%	62.5%	Excluded
CNP CenterPoint Energy	Utilities	100.0% [100–100]	high	82.6%	9.7%	5.2%	Excluded
CPB Campbell's Company (The)	Consumer Staples	100.0% [100–100]	high	120.2%	3.4%	9.7%	Excluded
D Dominion Energy	Utilities	100.0% [100–100]	high	88.4%	12.3%	6.2%	Excluded
DE Deere & Company	Industrials	100.0% [100–100]	high	41.4%	7.1%	36.8%	Excluded
DOC Healthpeak Properties	Real Estate	100.0% [100–100]	high	75.2%	10.8%	5.1%	Excluded
DOW Dow Inc.	Materials	100.0% [100–100]	high	70.1%	2.2%	23.8%	Excluded
DTE DTE Energy	Utilities	100.0% [100–100]	high	87.9%	6.7%	7.2%	Excluded
DUK Duke Energy	Utilities	100.0% [100–100]	high	93.8%	11.3%	4.4%	Excluded
DVA DaVita	Health Care	100.0% [100–100]	high	104.2%	4.3%	23.9%	Excluded
ED Consolidated Edison	Utilities	100.0% [100–100]	high	71.9%	7.3%	9.8%	Excluded
EIX Edison International	Utilities	100.0% [100–100]	high	152.7%	8.0%	9.9%	Excluded
ES Eversource Energy	Utilities	100.0% [100–100]	high	116.4%	9.2%	8.2%	Excluded
ESS Essex Property Trust	Real Estate	100.0% [100–100]	high	37.0%	13.7%	0.8%	Excluded
ETR Entergy	Utilities	100.0% [100–100]	high	59.8%	10.3%	2.8%	Excluded
EVRG Evergy	Utilities	100.0% [100–100]	high	79.7%	10.3%	1.2%	Excluded
EXC Exelon	Utilities	100.0% [100–100]	high	110.2%	8.8%	11.2%	Excluded
EXR Extra Space Storage	Real Estate	100.0% [100–100]	high	44.6%	18.8%	5.3%	Excluded
F Ford Motor Company	Consumer Discretionary	100.0% [100–100]	high	287.3%	0.7%	111.8%	Excluded
FE FirstEnergy	Utilities	100.0% [100–100]	high	103.2%	6.8%	7.8%	Excluded
FRT Federal Realty Investment Trust	Real Estate	100.0% [100–100]	high	50.8%	14.4%	2.6%	Excluded
GEN Gen Digital	Information Technology	100.0% [100–100]	high	59.2%	14.7%	1.9%	Excluded
GIS General Mills	Consumer Staples	100.0% [100–100]	high	86.5%	2.8%	11.0%	Excluded
GM General Motors	Consumer Discretionary	100.0% [100–100]	high	187.3%	0.4%	83.2%	Excluded
INVH Invitation Homes	Real Estate	100.0% [100–100]	high	49.5%	13.0%	0.4%	Excluded
IRM Iron Mountain	Real Estate	100.0% [100–100]	high	50.1%	12.3%	3.8%	Excluded
KHC Kraft Heinz	Consumer Staples	100.0% [100–100]	high	76.8%	3.8%	8.2%	Excluded
KIM Kimco Realty	Real Estate	100.0% [100–100]	high	53.1%	15.4%	4.8%	Excluded
KMI Kinder Morgan	Energy	100.0% [100–100]	high	42.8%	10.6%	2.3%	Excluded
LNT Alliant Energy	Utilities	100.0% [100–100]	high	64.8%	11.1%	1.9%	Excluded
MOS Mosaic Company (The)	Materials	100.0% [100–100]	high	73.2%	2.0%	18.2%	Excluded
NEE NextEra Energy	Utilities	100.0% [100–100]	high	47.9%	16.7%	2.9%	Excluded
NI NiSource	Utilities	100.0% [100–100]	high	71.3%	10.0%	5.6%	Excluded
O Realty Income	Real Estate	100.0% [100–100]	high	50.8%	19.3%	7.6%	Excluded
OMC Omnicom Group	Communication Services	100.0% [100–100]	high	52.6%	1.5%	70.6%	Excluded
PCG PG&E Corporation	Utilities	100.0% [100–100]	high	165.7%	12.1%	31.7%	Excluded
PEG Public Service Enterprise Group	Utilities	100.0% [100–100]	high	62.5%	7.9%	6.9%	Excluded
PNW Pinnacle West Capital	Utilities	100.0% [100–100]	high	118.3%	7.9%	6.1%	Excluded
PPL PPL Corporation	Utilities	100.0% [100–100]	high	71.9%	8.9%	6.6%	Excluded
REG Regency Centers	Real Estate	100.0% [100–100]	high	37.1%	13.3%	2.0%	Excluded
SATS EchoStar	Communication Services	100.0% [100–100]	high	76.9%	10.1%	3.3%	Excluded
SBAC SBA Communications	Real Estate	100.0% [100–100]	high	71.8%	16.9%	1.2%	Excluded
SJM J.M. Smucker Company (The)	Consumer Staples	100.0% [100–100]	high	72.6%	4.5%	5.8%	Excluded
SO Southern Company	Utilities	100.0% [100–100]	high	70.1%	11.0%	3.9%	Excluded
SPG Simon Property Group	Real Estate	100.0% [100–100]	high	37.9%	15.3%	1.9%	Excluded
SRE Sempra	Utilities	100.0% [100–100]	high	57.7%	11.2%	3.3%	Excluded
T AT&T	Communication Services	100.0% [100–100]	high	90.5%	5.4%	5.2%	Excluded
UAL United Airlines Holdings	Industrials	100.0% [100–100]	high	99.6%	2.0%	7.7%	Excluded
UDR UDR, Inc.	Real Estate	100.0% [100–100]	high	43.4%	11.5%	1.1%	Excluded
VICI Vici Properties	Real Estate	100.0% [100–100]	high	58.9%	21.1%	62.4%	Excluded
VTRS Viatris	Health Care	100.0% [100–100]	high	73.1%	3.3%	16.7%	Excluded
VZ Verizon	Communication Services	100.0% [100–100]	high	92.4%	4.8%	13.8%	Excluded
WEC WEC Energy Group	Utilities	100.0% [100–100]	high	61.4%	9.1%	5.7%	Excluded
WMB Williams Companies	Energy	100.0% [100–100]	high	30.9%	12.1%	2.2%	Excluded
XEL Xcel Energy	Utilities	100.0% [100–100]	high	69.6%	9.2%	4.4%	Excluded
APTV Aptiv	Consumer Discretionary	100.0% [100–100]	high	66.5%	1.8%	31.5%	Excluded
EQR Equity Residential	Real Estate	100.0% [100–100]	high	33.8%	9.9%	0.0%	Excluded
OKE Oneok	Energy	100.0% [100–100]	high	57.2%	5.3%	5.3%	Excluded
PLD Prologis	Real Estate	100.0% [100–100]	high	26.8%	11.1%	0.6%	Excluded
SW Smurfit Westrock	Materials	100.0% [100–100]	high	65.6%	2.7%	20.3%	Excluded
VTR Ventas	Real Estate	100.0% [100–100]	high	30.2%	10.5%	0.9%	Excluded
CPT Camden Property Trust	Real Estate	100.0% [100–100]	high	37.9%	8.8%	0.1%	Excluded
IP International Paper	Materials	100.0% [100–100]	high	61.7%	2.3%	26.5%	Excluded
IQV IQVIA	Health Care	100.0% [100–100]	high	56.0%	4.5%	12.0%	Excluded
TMUS T-Mobile US	Communication Services	100.0% [100–100]	high	60.0%	4.3%	4.9%	Excluded
AVB AvalonBay Communities	Real Estate	100.0% [100–100]	high	37.2%	8.5%	0.0%	Excluded
BLDR Builders FirstSource	Industrials	100.0% [100–100]	high	64.4%	1.8%	19.3%	Excluded
CVS CVS Health	Health Care	100.0% [100–100]	high	64.5%	0.8%	32.1%	Excluded
HPQ HP Inc.	Information Technology	100.0% [100–100]	high	57.1%	1.0%	45.4%	Excluded
WBD Warner Bros. Discovery	Communication Services	100.0% [100–100]	high	47.9%	5.6%	9.4%	Excluded
MAA Mid-America Apartment Communities	Real Estate	100.0% [100–100]	high	35.8%	8.4%	0.0%	Excluded
BG Bunge Global	Consumer Staples	99.9% [100–100]	high	66.3%	0.9%	20.2%	Excluded
NRG NRG Energy	Utilities	99.9% [100–100]	high	58.5%	2.4%	14.3%	Excluded
LYB LyondellBasell	Materials	99.8% [99–100]	high	61.9%	1.6%	11.9%	Excluded
VST Vistra Corp.	Utilities	99.8% [99–100]	high	41.9%	5.5%	4.9%	Excluded
CDW CDW Corporation	Information Technology	99.8% [93–100]	high	44.4%	1.0%	52.6%	Excluded
AMGN Amgen	Health Care	99.7% [99–100]	high	30.1%	7.5%	5.3%	Excluded
DPZ Domino's	Consumer Discretionary	99.7% [99–100]	high	49.9%	4.0%	3.1%	Excluded
HCA HCA Healthcare	Health Care	99.6% [99–100]	high	50.7%	3.0%	11.3%	Excluded
SWK Stanley Black & Decker	Industrials	99.6% [99–100]	high	49.9%	3.4%	7.6%	Excluded
PFE Pfizer	Health Care	99.6% [99–100]	high	43.6%	4.3%	10.8%	Excluded
ZBH Zimmer Biomet	Health Care	99.5% [99–100]	high	47.0%	3.6%	10.7%	Excluded
OXY Occidental Petroleum	Energy	99.5% [99–100]	high	41.3%	5.0%	5.8%	Excluded
DG Dollar General	Consumer Staples	99.5% [96–100]	high	67.9%	0.5%	0.1%	Excluded
DLR Digital Realty	Real Estate	99.1% [98–100]	high	28.5%	7.2%	2.0%	Excluded
BMY Bristol Myers Squibb	Health Care	99.0% [98–100]	high	40.7%	3.9%	12.5%	Excluded
BALL Ball Corporation	Materials	98.9% [97–100]	high	46.5%	2.4%	17.3%	Excluded
KDP Keurig Dr Pepper	Consumer Staples	98.9% [97–100]	high	40.8%	4.5%	4.2%	Excluded
BDX Becton Dickinson	Health Care	98.8% [97–100]	high	48.2%	2.8%	7.5%	Excluded
UHS Universal Health Services	Health Care	98.6% [95–100]	high	50.0%	0.9%	25.2%	Excluded
SOLV Solventum	Health Care	98.5% [97–100]	high	39.1%	4.2%	9.2%	Excluded
YUM Yum! Brands	Consumer Discretionary	98.5% [97–100]	high	31.8%	6.1%	2.3%	Excluded
HPE Hewlett Packard Enterprise	Information Technology	98.3% [93–100]	high	53.2%	0.5%	20.1%	Excluded
KR Kroger	Consumer Staples	98.1% [90–100]	high	60.0%	0.4%	5.3%	Excluded
GPC Genuine Parts Company	Consumer Discretionary	97.2% [90–100]	high	48.3%	0.7%	24.3%	Excluded
MCD McDonald's	Consumer Discretionary	95.2% [91–99]	high	28.1%	5.9%	1.3%	Excluded
NSC Norfolk Southern	Industrials	94.8% [89–99]	high	24.3%	6.5%	1.4%	Excluded
CI Cigna	Health Care	94.7% [67–100]	high	40.3%	0.5%	37.0%	Excluded
MPC Marathon Petroleum	Energy	94.2% [85–99]	high	47.3%	1.1%	14.2%	Excluded
HST Host Hotels & Resorts	Real Estate	93.5% [87–99]	high	37.7%	3.8%	1.0%	Excluded
TRGP Targa Resources	Energy	93.2% [88–98]	high	30.5%	5.0%	2.6%	Excluded
HSIC Henry Schein	Health Care	89.9% [78–97]	high	41.5%	1.1%	20.0%	Excluded
GEHC GE HealthCare	Health Care	88.1% [78–96]	high	36.7%	2.1%	17.0%	Excluded
CSX CSX Corporation	Industrials	87.6% [77–95]	high	22.7%	6.0%	1.5%	Excluded
APA APA Corporation	Energy	87.0% [80–95]	high	35.0%	3.1%	8.1%	Excluded
WY Weyerhaeuser	Real Estate	86.7% [78–96]	high	33.2%	4.0%	1.9%	Excluded
VRSK Verisk Analytics	Industrials	85.5% [75–94]	high	23.8%	5.6%	2.3%	Excluded
IT Gartner	Information Technology	83.1% [69–94]	high	35.5%	1.9%	17.9%	Excluded
PSA Public Storage	Real Estate	81.1% [64–93]	high	19.3%	6.3%	0.3%	Excluded
ROP Roper Technologies	Information Technology	79.7% [71–90]	high	29.1%	4.1%	3.9%	Compliant
ORCL Oracle Corporation	Information Technology	78.8% [60–91]	high	18.5%	6.2%	1.5%	Excluded
EQIX Equinix	Real Estate	78.8% [63–91]	high	21.3%	5.7%	1.3%	Excluded
SYY Sysco	Consumer Staples	78.8% [61–92]	high	41.5%	0.8%	15.8%	Excluded
EQT EQT Corporation	Energy	77.4% [63–89]	high	22.2%	5.3%	4.2%	Excluded
ELV Elevance Health	Health Care	76.9% [48–93]	high	37.2%	0.7%	25.0%	Excluded
RVTY Revvity	Health Care	76.2% [68–87]	high	31.6%	3.2%	6.9%	Compliant
CRL Charles River Laboratories	Health Care	76.1% [67–87]	high	33.5%	2.7%	9.3%	Excluded
FDX FedEx	Industrials	74.6% [55–91]	high	41.3%	0.9%	12.5%	Excluded
URI United Rentals	Industrials	73.8% [63–85]	high	25.7%	4.5%	4.1%	Compliant
DAL Delta Air Lines	Industrials	73.8% [50–93]	high	43.1%	1.1%	6.1%	Excluded
GDDY GoDaddy	Information Technology	71.6% [55–90]	high	34.3%	3.0%	0.7%	Excluded
ATO Atmos Energy	Utilities	71.5% [58–87]	high	30.8%	3.6%	1.3%	Compliant
MKC McCormick & Company	Consumer Staples	71.4% [59–85]	high	33.3%	2.9%	5.0%	Excluded
IBM IBM	Information Technology	69.3% [60–81]	elevated	31.5%	2.9%	8.0%	Compliant
IFF International Flavors & Fragrances	Materials	69.1% [57–82]	elevated	34.1%	2.1%	11.4%	Excluded
UNP Union Pacific Corporation	Industrials	65.8% [47–82]	elevated	20.5%	5.3%	1.2%	Excluded
FICO Fair Isaac	Information Technology	64.0% [31–85]	elevated	12.3%	6.7%	2.1%	Excluded
SNPS Synopsys	Information Technology	64.0% [36–83]	elevated	14.6%	6.3%	1.5%	Excluded
PCAR Paccar	Industrials	58.7% [8–90]	elevated	26.4%	1.0%	36.7%	Compliant
WELL Welltower	Real Estate	57.6% [28–79]	elevated	13.9%	6.1%	3.1%	Excluded
DGX Quest Diagnostics	Health Care	57.2% [44–71]	elevated	31.6%	2.5%	6.8%	Compliant
FOX Fox Corporation (Class B)	Communication Services	57.0% [45–68]	elevated	30.3%	2.5%	10.0%	Compliant
EL Estée Lauder Companies (The)	Consumer Staples	56.7% [42–73]	elevated	32.4%	2.5%	5.2%	Compliant
PPG PPG Industries	Materials	56.1% [40–71]	elevated	33.4%	1.5%	14.1%	Excluded
EFX Equifax	Industrials	55.9% [44–68]	elevated	26.8%	3.5%	5.3%	Compliant
VEEV Veeva Systems	Health Care	55.5% [10–88]	elevated	0.4%	8.4%	5.1%	Excluded
WM Waste Management	Industrials	54.2% [41–67]	elevated	26.1%	3.6%	4.6%	Compliant
HON Honeywell	Industrials	54.0% [42–66]	elevated	25.8%	3.6%	5.5%	Compliant
LDOS Leidos	Industrials	52.0% [32–69]	elevated	33.1%	1.2%	17.2%	Excluded
TSN Tyson Foods	Consumer Staples	49.7% [30–70]	elevated	37.6%	0.8%	10.8%	Excluded
HAS Hasbro	Consumer Discretionary	48.6% [35–59]	elevated	24.3%	3.5%	7.8%	Compliant
UPS United Parcel Service	Industrials	47.3% [31–63]	elevated	34.2%	1.1%	13.4%	Excluded
LOW Lowe's	Consumer Discretionary	42.4% [20–71]	moderate	35.7%	1.8%	0.9%	Excluded
KVUE Kenvue	Consumer Staples	41.9% [29–52]	moderate	26.3%	2.8%	8.5%	Compliant
ABBV AbbVie	Health Care	40.5% [21–57]	moderate	18.1%	4.7%	3.4%	Compliant
LH Labcorp	Health Care	39.0% [25–51]	moderate	31.3%	1.6%	10.8%	Compliant
OTIS Otis Worldwide	Industrials	38.3% [21–52]	moderate	30.4%	1.4%	15.7%	Compliant
FOXA Fox Corporation (Class A)	Communication Services	37.3% [25–46]	moderate	27.2%	2.5%	9.0%	Compliant
AVY Avery Dennison	Materials	36.9% [23–48]	moderate	30.7%	1.5%	12.4%	Compliant
ZTS Zoetis	Health Care	34.5% [21–47]	moderate	29.2%	2.3%	5.0%	Compliant
DD DuPont	Materials	33.0% [12–51]	moderate	15.4%	4.6%	8.1%	Compliant
TMO Thermo Fisher Scientific	Health Care	32.6% [19–42]	moderate	23.6%	3.2%	6.3%	Compliant
MDT Medtronic	Health Care	31.9% [19–43]	moderate	28.9%	2.2%	6.6%	Compliant
DLTR Dollar Tree	Consumer Staples	27.4% [7–66]	moderate	40.3%	0.4%	0.0%	Excluded
MCHP Microchip Technology	Information Technology	25.9% [7–49]	moderate	10.8%	5.7%	1.3%	Excluded
CRH CRH plc	Materials	23.9% [13–33]	moderate	27.4%	2.2%	6.0%	Compliant
RSG Republic Services	Industrials	23.8% [11–34]	moderate	21.5%	3.5%	3.4%	Compliant
CBRE CBRE Group	Real Estate	21.1% [3–42]	moderate	25.8%	0.5%	27.2%	Compliant
HUM Humana	Health Care	20.7% [8–34]	moderate	34.2%	0.5%	9.0%	Excluded
BIIB Biogen	Health Care	20.5% [10–28]	moderate	23.3%	2.7%	6.6%	Compliant
TGT Target Corporation	Consumer Staples	17.5% [5–39]	low	36.3%	0.4%	3.2%	Excluded
TSCO Tractor Supply	Consumer Discretionary	16.3% [4–44]	low	37.2%	0.4%	0.2%	Excluded
PSX Phillips 66	Energy	16.1% [6–24]	low	28.7%	0.8%	14.2%	Compliant
MMM 3M	Industrials	15.3% [5–25]	low	16.7%	3.8%	4.7%	Compliant
BBY Best Buy	Consumer Discretionary	14.9% [5–27]	low	34.6%	0.1%	8.7%	Excluded
MDLZ Mondelez International	Consumer Staples	14.6% [6–22]	low	27.9%	1.6%	6.2%	Compliant
APD Air Products	Materials	13.8% [5–23]	low	27.6%	1.8%	3.5%	Compliant
HAL Halliburton	Energy	13.7% [4–21]	low	23.6%	1.6%	14.3%	Compliant
COR Cencora	Health Care	13.1% [0–60]	low	15.1%	0.1%	49.6%	Excluded
ALB Albemarle Corporation	Materials	12.0% [3–21]	low	14.6%	4.0%	3.4%	Compliant
MLM Martin Marietta Materials	Materials	11.2% [3–20]	low	16.5%	3.7%	2.1%	Compliant
COO Cooper Companies (The)	Health Care	11.2% [4–17]	low	21.3%	2.4%	7.0%	Compliant
IR Ingersoll Rand	Industrials	11.2% [3–18]	low	17.3%	3.3%	5.4%	Compliant
NXPI NXP Semiconductors	Information Technology	11.1% [3–20]	low	16.5%	3.8%	1.4%	Compliant
J Jacobs Solutions	Industrials	10.1% [1–20]	low	20.3%	1.2%	22.4%	Compliant
FANG Diamondback Energy	Energy	10.1% [3–18]	low	26.4%	1.8%	2.5%	Compliant
AZO AutoZone	Consumer Discretionary	8.6% [2–16]	low	21.9%	2.6%	1.2%	Compliant
CLX Clorox	Consumer Staples	8.3% [3–13]	low	26.1%	1.2%	7.4%	Compliant
DRI Darden Restaurants	Consumer Discretionary	8.2% [2–17]	low	28.0%	1.5%	0.4%	Compliant
LEN Lennar	Consumer Discretionary	8.0% [2–14]	low	28.0%	0.0%	17.5%	Compliant
LUV Southwest Airlines	Industrials	7.9% [2–15]	low	31.1%	0.4%	6.0%	Compliant
ZBRA Zebra Technologies	Information Technology	7.7% [2–12]	low	21.9%	2.0%	6.8%	Compliant
FTV Fortive	Industrials	7.7% [2–13]	low	18.4%	2.9%	3.8%	Compliant
CARR Carrier Global	Industrials	7.5% [2–12]	low	22.1%	2.1%	4.8%	Compliant
EXE Expand Energy	Energy	7.1% [2–11]	low	21.9%	1.9%	6.9%	Compliant
GILD Gilead Sciences	Health Care	7.0% [2–13]	low	15.2%	3.5%	3.0%	Compliant

Showing first 200 of 393 rows.

Model specification

The binary outcome y = 1 if a company is classified non-compliant under AAOIFI Shariah Standard No. 21; y = 0 if compliant. The logistic model is:

logit P(non-compliant) = β₀ + β₁·debt_ratio* + β₂·interest_ratio* + β₃·receivables_ratio*

* Standardised (zero mean, unit SD) for coefficient comparability. Estimation via IRLS (Iteratively Reweighted Least Squares). Bootstrap inference uses 2 000 nonparametric replicates; bias-corrected estimates (β̂_BC) are reported alongside MLE. The high AUC (0.988) and McFadden R² (0.797) reflect the deterministic structure of AAOIFI thresholds — the ratios are the criteria — making this an exact model of the screening rule rather than a predictive approximation.

AAOIFI financial screening thresholds

Ratio	Threshold	Model coefficient direction
`Total debt / market cap`	< 33%	β = 9.251 — largest predictor; OR 4071.318
`Interest expense / revenue`	< 5%	β = 4.729 — second largest; OR 79.295
`Receivables / market cap`	< 49%	β = 1.157 — third; OR 3.266

Business-screen failures (e.g. alcohol, tobacco, weapons, conventional banking) are excluded from the model because they are not ratio-based. The 110 business-screen fails in the original screen are absent from this model's 393-company sample — those companies had missing financial ratios or were excluded upstream.

Shariah compliance risk tiers

Tier	P(non-compliant)	Interpretation
High	≥ 70%	Model strongly predicts non-compliance; ratio breaches likely
Elevated	45–70%	Close to AAOIFI boundary — high sensitivity to ratio changes
Moderate	20–45%	Some ratio pressure but below threshold; monitor quarterly
Low	< 20%	Ratios well within AAOIFI limits; low reclassification risk

Reference

Methodology follows: Botta, C. (2026). Logistic Regression for Financial Risk: Standard and Bootstrap Inference from Scratch. Bocconi University. IRLS estimation and nonparametric bootstrap are re-implemented in Python (NumPy) to produce the results shown here.