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Halliburton Co (NYSE:HAL)
Beneish M-Score
-5.41 (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 -5.41 suggests that the company is not a manipulator.

HAL' s Beneish M-Score Range Over the Past 10 Years
Min: -5.41   Max: 1.11
Current: -5.41

-5.41
1.11

During the past 13 years, the highest Beneish M-Score of Halliburton Co was 1.11. The lowest was -5.41. And the median was -2.42.


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 * 1.3656+0.528 * 1.8971+0.404 * 1.6167+0.892 * 0.6142+0.115 * 1.0715
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 18.8144+4.679 * -0.0957-0.327 * 1.4293
=-5.41

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $4,725 Mil.
Revenue was 3835 + 4198 + 5082 + 5582 = $18,697 Mil.
Gross Profit was 103 + 273 + 526 + 543 = $1,445 Mil.
Total Current Assets was $12,580 Mil.
Total Assets was $27,737 Mil.
Property, Plant and Equipment(Net PPE) was $8,961 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,561 Mil.
Selling, General & Admin. Expense(SGA) was $3,698 Mil.
Total Current Liabilities was $4,478 Mil.
Long-Term Debt was $12,158 Mil.
Net Income was -3208 + -2412 + -28 + -54 = $-5,702 Mil.
Non Operating Income was -31 + -47 + -43 + -34 = $-155 Mil.
Cash Flow from Operations was -3632 + -171 + 885 + 26 = $-2,892 Mil.
Accounts Receivable was $5,633 Mil.
Revenue was 5919 + 7050 + 8770 + 8701 = $30,440 Mil.
Gross Profit was 686 + 765 + 1304 + 1708 = $4,463 Mil.
Total Current Assets was $15,224 Mil.
Total Assets was $30,606 Mil.
Property, Plant and Equipment(Net PPE) was $11,153 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,108 Mil.
Selling, General & Admin. Expense(SGA) was $320 Mil.
Total Current Liabilities was $5,005 Mil.
Long-Term Debt was $7,838 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)
=(4725 / 18697) / (5633 / 30440)
=0.25271434 / 0.18505256
=1.3656

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)
=(4463 / 30440) / (1445 / 18697)
=0.14661629 / 0.07728513
=1.8971

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 - (12580 + 8961) / 27737) / (1 - (15224 + 11153) / 30606)
=0.22338393 / 0.13817552
=1.6167

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
=18697 / 30440
=0.6142

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))
=(2108 / (2108 + 11153)) / (1561 / (1561 + 8961))
=0.15896237 / 0.14835583
=1.0715

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)
=(3698 / 18697) / (320 / 30440)
=0.19778574 / 0.01051248
=18.8144

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)
=((12158 + 4478) / 27737) / ((7838 + 5005) / 30606)
=0.59977647 / 0.4196236
=1.4293

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
=(-5702 - -155 - -2892) / 27737
=-0.0957

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 -5.41 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 -0.0770.0595-0.029-0.0746-0.0175-0.0346-0.0358-0.078-0.0174-0.0881
M-score -3.19-1.96-2.32-2.82-2.29-2.38-2.37-2.87-2.32-3.06

Halliburton Co Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.97691.00281.04371.09460.92940.83260.89050.97771.21681.3656
GMI 0.98920.92160.8880.9360.98191.06281.37661.52361.59191.8971
AQI 1.01311.03241.00921.09170.99110.90740.96060.76351.1261.6167
SGI 1.04081.06341.09251.1181.09390.99770.86080.7190.6380.6142
DEPI 0.94840.95650.98030.98690.97220.92460.95671.01141.00831.0715
SGAI 1.15711.06310.9740.78440.770.94890.99031.34321.462218.8144
LVGI 1.27171.23570.96420.96440.96480.97020.98631.28051.37531.4293
TATA -0.0761-0.0683-0.0434-0.0174-0.0487-0.0743-0.0883-0.0881-0.1242-0.0957
M-score -2.94-2.86-2.60-2.32-2.65-2.98-2.93-3.13-3.02-5.41
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