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Hess Corp (NYSE:HES)
Beneish M-Score
-3.30 (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 -3.30 suggests that the company is not a manipulator.

HES' s Beneish M-Score Range Over the Past 10 Years
Min: -3.69   Max: -0.1
Current: -3.3

-3.69
-0.1

During the past 13 years, the highest Beneish M-Score of Hess Corp was -0.10. The lowest was -3.69. And the median was -2.72.


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 * 0.8055+0.528 * 1.298+0.404 * 1.0058+0.892 * 0.6177+0.115 * 0.796
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.7387+4.679 * -0.0709-0.327 * 0.9344
=-3.30

* 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 $1,522 Mil.
Revenue was 1671 + 1935 + 1550 + 3259 = $8,415 Mil.
Gross Profit was 778 + 1031 + 461 + 2265 = $4,535 Mil.
Total Current Assets was $5,597 Mil.
Total Assets was $36,456 Mil.
Property, Plant and Equipment(Net PPE) was $26,883 Mil.
Depreciation, Depletion and Amortization(DDA) was $3,847 Mil.
Selling, General & Admin. Expense(SGA) was $581 Mil.
Total Current Liabilities was $2,624 Mil.
Long-Term Debt was $6,474 Mil.
Net Income was -279 + -567 + -389 + -8 = $-1,243 Mil.
Non Operating Income was 18 + -385 + 0 + -731 = $-1,098 Mil.
Cash Flow from Operations was 282 + 714 + 362 + 1081 = $2,439 Mil.
Accounts Receivable was $3,059 Mil.
Revenue was 2678 + 3583 + 2592 + 4771 = $13,624 Mil.
Gross Profit was 1675 + 2539 + 1552 + 3764 = $9,530 Mil.
Total Current Assets was $8,865 Mil.
Total Assets was $40,975 Mil.
Property, Plant and Equipment(Net PPE) was $27,667 Mil.
Depreciation, Depletion and Amortization(DDA) was $3,062 Mil.
Selling, General & Admin. Expense(SGA) was $541 Mil.
Total Current Liabilities was $5,015 Mil.
Long-Term Debt was $5,929 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)
=(1522 / 8415) / (3059 / 13624)
=0.1808675 / 0.22453024
=0.8055

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)
=(1031 / 13624) / (778 / 8415)
=0.69950088 / 0.5389186
=1.298

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 - (5597 + 26883) / 36456) / (1 - (8865 + 27667) / 40975)
=0.10906298 / 0.10843197
=1.0058

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
=8415 / 13624
=0.6177

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))
=(3062 / (3062 + 27667)) / (3847 / (3847 + 26883))
=0.09964529 / 0.12518711
=0.796

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)
=(581 / 8415) / (541 / 13624)
=0.06904337 / 0.03970934
=1.7387

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)
=((6474 + 2624) / 36456) / ((5929 + 5015) / 40975)
=0.24956111 / 0.26708969
=0.9344

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
=(-1243 - -1098 - 2439) / 36456
=-0.0709

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 -3.30 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

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.85881.07810.70341.17961.10421.76271.39580.74930.72120
GMI 0.83551.02660.94081.01870.85790.70120.63580.97471.07421.2189
AQI 0.84640.91590.9970.9440.94191.00260.92490.87570.90030.887
SGI 1.23391.12761.29750.72011.17060.60250.62021.08450.81540.5736
DEPI 1.07540.93030.88860.93631.18241.1280.96821.05940.81440.8037
SGAI 0.91760.99450.76081.35430.86871.40720.65081.07741.07141.6516
LVGI 0.8750.97830.88340.93890.98010.97011.00320.77490.99650.9608
TATA -0.099-0.0747-0.0804-0.0764-0.0529-0.0747-0.08370.0043-0.0557-0.1
M-score -2.95-2.66-2.83-2.98-2.53-2.68-3.01-2.61-3.20-4.30

Hess Corp Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.28521.17744.27092.73213.37220.80920.51760.80210.80550
GMI 1.31710.72140.54160.50110.4980.84661.06591.20411.2981.5467
AQI 0.89060.87571.00380.97080.86940.90031.00650.98781.00580.887
SGI 1.46820.69020.48190.50540.51050.72670.84170.68940.61770.5402
DEPI 1.00031.05941.18650.98690.9010.81440.75830.8080.7960.8037
SGAI 1.38020.8960.78970.66920.60110.92471.11121.50041.73871.7535
LVGI 0.82520.77490.81220.92840.90670.99650.94270.96660.93440.9608
TATA -0.04930.0042-0.00960.01320.0243-0.0382-0.0402-0.0668-0.0709-0.1006
M-score -2.84-2.67-0.10-1.46-0.85-3.21-3.24-3.25-3.30-4.18
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