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Halliburton Co (NYSE:HAL)
Beneish M-Score
-2.91 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Halliburton Co has a M-score of -2.91 suggests that the company is not a manipulator.

HAL' s Beneish M-Score Range Over the Past 10 Years
Min: -3.83   Max: 0.95
Current: -2.91

-3.83
0.95

During the past 13 years, the highest Beneish M-Score of Halliburton Co was 0.95. The lowest was -3.83. And the median was -2.57.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Halliburton Co for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 0.8905+0.528 * 1.3766+0.404 * 0.9606+0.892 * 0.8608+0.115 * 0.9567
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8363+4.679 * -0.0883-0.327 * 0.9863
=-2.91

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $5,791 Mil.
Revenue was 5582 + 5919 + 7050 + 8770 = $27,321 Mil.
Gross Profit was 543 + 686 + 765 + 1304 = $3,298 Mil.
Total Current Assets was $14,919 Mil.
Total Assets was $30,248 Mil.
Property, Plant and Equipment(Net PPE) was $11,018 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,990 Mil.
Selling, General & Admin. Expense(SGA) was $239 Mil.
Total Current Liabilities was $5,703 Mil.
Long-Term Debt was $7,243 Mil.
Net Income was -54 + 54 + -643 + 901 = $258 Mil.
Non Operating Income was -34 + -23 + -224 + 41 = $-240 Mil.
Cash Flow from Operations was 26 + 1183 + 812 + 1149 = $3,170 Mil.
Accounts Receivable was $7,555 Mil.
Revenue was 8701 + 8051 + 7348 + 7639 = $31,739 Mil.
Gross Profit was 1708 + 1283 + 1045 + 1238 = $5,274 Mil.
Total Current Assets was $14,847 Mil.
Total Assets was $31,583 Mil.
Property, Plant and Equipment(Net PPE) was $12,050 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,066 Mil.
Selling, General & Admin. Expense(SGA) was $332 Mil.
Total Current Liabilities was $5,889 Mil.
Long-Term Debt was $7,816 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(5791 / 27321) / (7555 / 31739)
=0.21196149 / 0.23803522
=0.8905

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(686 / 31739) / (543 / 27321)
=0.16616781 / 0.120713
=1.3766

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (14919 + 11018) / 30248) / (1 - (14847 + 12050) / 31583)
=0.14252182 / 0.14837096
=0.9606

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=27321 / 31739
=0.8608

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(2066 / (2066 + 12050)) / (1990 / (1990 + 11018))
=0.14635874 / 0.15298278
=0.9567

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(239 / 27321) / (332 / 31739)
=0.00874785 / 0.01046032
=0.8363

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((7243 + 5703) / 30248) / ((7816 + 5889) / 31583)
=0.42799524 / 0.43393598
=0.9863

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(258 - -240 - 3170) / 30248
=-0.0883

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Halliburton Co has a M-score of -2.91 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Halliburton Co Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.42690.99851.02460.97281.0810.93790.99161.03541.09460.9777
GMI 0.85671.11211.05851.54640.83060.89141.21681.09220.9361.5236
AQI 0.92180.79661.0360.84961.08461.08530.97370.96791.09170.7635
SGI 1.28271.17821.19750.80281.22471.38151.1481.03151.1180.719
DEPI 0.91551.14211.0350.96070.99011.01891.00710.95320.98691.0114
SGAI 0.90690.72710.80370.91430.90330.88820.85251.17390.78440.9526
LVGI 0.92670.86030.97271.0880.88611.04990.92481.25840.96441.2805
TATA -0.08050.0595-0.029-0.0746-0.0175-0.0346-0.0358-0.078-0.0174-0.0881
M-score -3.21-1.96-2.32-2.82-2.29-2.38-2.37-2.87-2.32-3.06

Halliburton Co Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.09861.03540.97691.00281.04371.09460.92940.83260.89050.9777
GMI 1.24071.09220.98920.92160.8880.9360.98191.06281.37661.5134
AQI 1.00010.96791.01311.03241.00921.09170.99110.90740.96060.7635
SGI 1.02741.03151.04081.06341.09251.1181.09390.99770.86080.719
DEPI 0.97020.95320.94840.95650.98030.98690.97220.92460.95671.0114
SGAI 1.12891.17391.15711.06310.9740.78440.87610.81840.83631.2146
LVGI 1.25731.25841.27171.23570.96420.96440.96480.97020.98631.2805
TATA -0.0803-0.078-0.0761-0.0683-0.0434-0.0174-0.0487-0.0743-0.0883-0.0881
M-score -2.72-2.87-2.94-2.86-2.60-2.32-2.67-2.96-2.91-3.12
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