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HollyFrontier Corp (NYSE:HFC)
Beneish M-Score
-1.87 (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.

HollyFrontier Corp has a M-score of -1.87 signals that the company is a manipulator.

HFC' s 10-Year Beneish M-Score Range
Min: -4.61   Max: 1.87
Current: -1.87

-4.61
1.87

During the past 13 years, the highest Beneish M-Score of HollyFrontier Corp was 1.87. The lowest was -4.61. And the median was -2.27.


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 HollyFrontier 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 * 0.9903+0.528 * 2.466+0.404 * 1.0433+0.892 * 1.019+0.115 * 0.8952
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9505+4.679 * -0.0413-0.327 * 0.993
=-1.87

* 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 $701 Mil.
Revenue was 4791.053 + 4826.801 + 5327.122 + 5298.848 = $20,244 Mil.
Gross Profit was 378.467 + 202.016 + 260.814 + 564.498 = $1,406 Mil.
Total Current Assets was $4,186 Mil.
Total Assets was $10,381 Mil.
Property, Plant and Equipment(Net PPE) was $3,442 Mil.
Depreciation, Depletion and Amortization(DDA) was $312 Mil.
Selling, General & Admin. Expense(SGA) was $126 Mil.
Total Current Liabilities was $1,917 Mil.
Long-Term Debt was $1,023 Mil.
Net Income was 152.061 + 62.902 + 82.29 + 256.981 = $554 Mil.
Non Operating Income was -8.478 + -1.201 + 0.159 + -23.198 = $-33 Mil.
Cash Flow from Operations was 394.929 + 67.011 + 350.648 + 202.952 = $1,016 Mil.
Accounts Receivable was $694 Mil.
Revenue was 4707.789 + 5147.507 + 5204.798 + 4806.681 = $19,867 Mil.
Gross Profit was 650.155 + 777.527 + 1072.203 + 902.191 = $3,402 Mil.
Total Current Assets was $4,763 Mil.
Total Assets was $10,696 Mil.
Property, Plant and Equipment(Net PPE) was $3,214 Mil.
Depreciation, Depletion and Amortization(DDA) was $259 Mil.
Selling, General & Admin. Expense(SGA) was $130 Mil.
Total Current Liabilities was $1,767 Mil.
Long-Term Debt was $1,283 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)
=(700.769 / 20243.824) / (694.428 / 19866.775)
=0.03461643 / 0.03495424
=0.9903

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)
=(202.016 / 19866.775) / (378.467 / 20243.824)
=0.1712445 / 0.06944315
=2.466

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 - (4185.509 + 3442.299) / 10380.558) / (1 - (4763.31 + 3214.198) / 10696.172)
=0.26518324 / 0.25417168
=1.0433

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
=20243.824 / 19866.775
=1.019

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))
=(258.528 / (258.528 + 3214.198)) / (312.232 / (312.232 + 3442.299))
=0.07444526 / 0.08316139
=0.8952

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)
=(125.688 / 20243.824) / (129.771 / 19866.775)
=0.00620871 / 0.00653206
=0.9505

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)
=((1023.057 + 1916.51) / 10380.558) / ((1283.245 + 1766.954) / 10696.172)
=0.28318006 / 0.28516735
=0.993

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
=(554.234 - -32.718 - 1015.54) / 10380.558
=-0.0413

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.

HollyFrontier Corp has a M-score of -1.87 signals that the company is likely to 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.

HollyFrontier Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.01340.9910.76711.30140.38213.290.75760.4110.68461.1497
GMI 0.75590.94131.00850.9571.22071.99730.91320.41630.80411.9472
AQI 1.0310.32820.81412.23181.53880.81320.88054.16810.9491.0663
SGI 1.50811.43951.32071.1911.2230.82491.72171.85511.30131.0035
DEPI 0.92830.94271.34741.1941.4670.89540.91861.26140.70360.861
SGAI 0.96640.70830.92670.91290.65721.32330.68190.9140.81960.9955
LVGI 0.86831.1090.89131.0880.87261.28371.07940.54550.89290.9176
TATA -0.0818-0.07820.0068-0.0647-0.0214-0.0607-0.0491-0.03160.0059-0.0109
M-score -2.47-2.76-2.36-1.85-2.46-0.52-2.36-1.24-2.57-1.85

HollyFrontier Corp Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.4110.34830.33540.36890.68460.76291.1671.03811.14970.9903
GMI 0.41630.56650.6150.87540.80410.74670.94521.34451.94722.466
AQI 4.16813.87124.09590.97860.9490.96150.9631.05471.06631.0433
SGI 1.85512.05632.0721.57081.30131.1011.02391.02841.00351.019
DEPI 1.26141.11130.98410.63820.70360.76120.82460.86050.8610.8952
SGAI 0.9140.91160.95840.83650.81960.9010.89150.98680.99550.9505
LVGI 0.54550.5760.52920.910.89290.81980.89820.8330.91760.993
TATA -0.0316-0.02780.0190.0130.00590.0149-0.0076-0.0196-0.0109-0.0413
M-score -1.24-1.17-0.84-2.55-2.57-2.64-2.35-2.27-1.85-1.87
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