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Hess Corp (NYSE:HES)
Beneish M-Score
-3.65 (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.

Hess Corp has a M-score of -3.65 suggests that the company is not a manipulator.

HES' s 10-Year Beneish M-Score Range
Min: -3.86   Max: -0.98
Current: -3.65

-3.86
-0.98

During the past 13 years, the highest Beneish M-Score of Hess Corp was -0.98. The lowest was -3.86. And the median was -2.71.


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 Hess Corp 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+0.528 * 1.0435+0.404 * 0.9987+0.892 * 0.9166+0.115 * 1.5483
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.2266+4.679 * -0.0597-0.327 * 0.8231
=-3.65

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $0 Mil.
Revenue was 5554 + 13101 + 2706 + 3011 = $24,372 Mil.
Gross Profit was 1985 + 2059 + 1619 + 1783 = $7,446 Mil.
Total Current Assets was $7,260 Mil.
Total Assets was $41,636 Mil.
Property, Plant and Equipment(Net PPE) was $29,166 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,081 Mil.
Selling, General & Admin. Expense(SGA) was $1,873 Mil.
Total Current Liabilities was $6,193 Mil.
Long-Term Debt was $5,434 Mil.
Net Income was 386 + 1925 + 420 + 1431 = $4,162 Mil.
Non Operating Income was -48 + 400 + -8 + 1094 = $1,438 Mil.
Cash Flow from Operations was 1158 + 1550 + 1254 + 1247 = $5,209 Mil.
Accounts Receivable was $1,840 Mil.
Revenue was 6106 + 14089 + 3072 + 3324 = $26,591 Mil.
Gross Profit was 2118 + 2498 + 1742 + 2119 = $8,477 Mil.
Total Current Assets was $11,418 Mil.
Total Assets was $42,379 Mil.
Property, Plant and Equipment(Net PPE) was $25,651 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,949 Mil.
Selling, General & Admin. Expense(SGA) was $1,666 Mil.
Total Current Liabilities was $8,906 Mil.
Long-Term Debt was $5,472 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)
=(0 / 24372) / (1840 / 26591)
=0 / 0.06919634
=0

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)
=(2059 / 26591) / (1985 / 24372)
=0.31879207 / 0.30551452
=1.0435

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 - (7260 + 29166) / 41636) / (1 - (11418 + 25651) / 42379)
=0.1251321 / 0.12529791
=0.9987

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
=24372 / 26591
=0.9166

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))
=(2949 / (2949 + 25651)) / (2081 / (2081 + 29166))
=0.10311189 / 0.06659839
=1.5483

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)
=(1873 / 24372) / (1666 / 26591)
=0.07685048 / 0.06265278
=1.2266

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)
=((5434 + 6193) / 41636) / ((5472 + 8906) / 42379)
=0.27925353 / 0.33927181
=0.8231

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
=(4162 - 1438 - 5209) / 41636
=-0.0597

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.

Hess Corp has a M-score of -3.65 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.

Hess Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.05221.16260.85881.07810.70341.26821.04990.9351
GMI 0.97621.1880.83551.02660.94081.01871.01631.06920.7155
AQI 1.05581.06010.84640.91590.9970.9440.94191.00260.8908
SGI 1.18271.32821.23391.12761.29750.72011.14521.1360.5912
DEPI 1.13891.05241.07540.93030.87690.94881.18241.11390
SGAI 0.86970.94480.91760.99450.76081.35430.8880.92631.5111
LVGI 1.11231.02680.8750.97830.88340.93890.98010.97010.7796
TATA -0.0809-0.0584-0.099-0.0747-0.083-0.0627-0.0892-0.0686-0.0457
M-score -2.64-2.18-2.95-2.66-2.84-2.84-2.69-2.67-3.38

Hess Corp Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 1.10151.54622.01521.42420.42830.40190.30230.762300
GMI 1.06890.86380.59260.61430.70180.88151.11581.13351.04351.0706
AQI 1.05721.00160.91840.92490.79790.84180.89060.87570.99870.9708
SGI 0.87740.65470.50590.60780.8621.07851.38491.0660.91660.9212
DEPI 1.10191.03990.98190.96340.85230.94280.99281.04861.54831.8813
SGAI 0.96371.03550.95591.31451.32741.32831.41761.21.22661.2045
LVGI 1.05991.08321.09661.00320.91140.81610.82520.77490.82310.9284
TATA -0.0747-0.0663-0.0968-0.0999-0.0951-0.1026-0.08-0.0458-0.0597-0.0571
M-score -2.79-2.70-2.71-3.20-3.86-3.57-3.15-2.79-3.65-3.62
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