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HollyFrontier Corp (NYSE:HFC)
Beneish M-Score
-3.42 (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 -3.42 suggests that the company is not a manipulator.

HFC' s Beneish M-Score Range Over the Past 10 Years
Min: -4.61   Max: 1.89
Current: -3.42

-4.61
1.89

During the past 13 years, the highest Beneish M-Score of HollyFrontier Corp was 1.89. The lowest was -4.61. And the median was -2.36.


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 * 1.1136+0.528 * 0.9061+0.404 * 0.991+0.892 * 0.6906+0.115 * 1.0009
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.5164+4.679 * -0.1114-0.327 * 1.3248
=-3.42

* 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 $482 Mil.
Revenue was 2714.638 + 2018.724 + 2943.559 + 3585.823 = $11,263 Mil.
Gross Profit was 353.62 + 197.099 + 68.28 + 441.115 = $1,060 Mil.
Total Current Assets was $2,118 Mil.
Total Assets was $8,660 Mil.
Property, Plant and Equipment(Net PPE) was $3,954 Mil.
Depreciation, Depletion and Amortization(DDA) was $357 Mil.
Selling, General & Admin. Expense(SGA) was $120 Mil.
Total Current Liabilities was $1,049 Mil.
Long-Term Debt was $1,678 Mil.
Net Income was -409.368 + 21.253 + -43.921 + 196.322 = $-236 Mil.
Non Operating Income was 3.751 + -5.888 + 2.704 + 8.497 = $9 Mil.
Cash Flow from Operations was 303.69 + 6.636 + 76.285 + 333.401 = $720 Mil.
Accounts Receivable was $626 Mil.
Revenue was 3701.912 + 3006.626 + 4283.119 + 5317.555 = $16,309 Mil.
Gross Profit was 703.752 + 498.203 + -221.748 + 410.705 = $1,391 Mil.
Total Current Assets was $2,520 Mil.
Total Assets was $9,145 Mil.
Property, Plant and Equipment(Net PPE) was $3,868 Mil.
Depreciation, Depletion and Amortization(DDA) was $349 Mil.
Selling, General & Admin. Expense(SGA) was $115 Mil.
Total Current Liabilities was $1,240 Mil.
Long-Term Debt was $933 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)
=(481.508 / 11262.744) / (626.107 / 16309.212)
=0.04275228 / 0.03838978
=1.1136

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)
=(1390.912 / 16309.212) / (1060.114 / 11262.744)
=0.08528383 / 0.09412573
=0.9061

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 - (2118.098 + 3954.044) / 8659.717) / (1 - (2519.539 + 3868.395) / 9145.286)
=0.29880595 / 0.30150528
=0.991

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
=11262.744 / 16309.212
=0.6906

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))
=(349.258 / (349.258 + 3868.395)) / (356.639 / (356.639 + 3954.044))
=0.08280861 / 0.08273376
=1.0009

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)
=(120.436 / 11262.744) / (115.007 / 16309.212)
=0.01069331 / 0.00705166
=1.5164

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)
=((1678.123 + 1048.554) / 8659.717) / ((933.162 + 1240.491) / 9145.286)
=0.31486907 / 0.23768016
=1.3248

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
=(-235.714 - 9.064 - 720.012) / 8659.717
=-0.1114

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 -3.42 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.

HollyFrontier Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.75011.29650.38393.20250.75660.38480.68761.11370.84890.8908
GMI 1.00850.9571.22071.99730.91320.41630.80411.94721.65520.3888
AQI 0.81412.23181.53880.81320.88054.16810.9491.06631.09381.1194
SGI 1.32071.1911.2230.82491.72171.85511.30131.00350.98030.6698
DEPI 1.34741.1941.4670.89540.91861.26140.70360.8610.91091.1611
SGAI 0.92670.91290.65721.32330.68190.9140.81960.99550.91361.5743
LVGI 0.89131.0880.87261.28371.07940.54550.89290.91760.93310.9139
TATA 0.0068-0.0647-0.0214-0.0607-0.0491-0.03160.0059-0.0109-0.0508-0.0291
M-score -2.37-1.86-2.46-0.60-2.36-1.27-2.56-1.88-2.46-3.34

HollyFrontier Corp Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 1.02891.01420.92120.84890.86180.99981.05420.89081.20051.1136
GMI 2.4662.41291.57621.65521.12160.73140.71580.38880.53780.9061
AQI 1.04330.98241.01311.09381.12581.15521.14661.11941.12980.991
SGI 1.0190.9980.99150.98030.88820.80270.71780.66980.68130.6906
DEPI 0.89520.86160.9160.91090.94981.08021.06641.16111.12541.0009
SGAI 0.95050.91370.90490.91361.05041.19341.39711.57431.46331.5164
LVGI 0.9931.04731.0070.93310.85780.82980.82420.91391.05091.3248
TATA -0.0413-0.0626-0.0289-0.0508-0.0267-0.0066-0.0329-0.0291-0.0245-0.1114
M-score -1.84-2.04-2.38-2.46-2.68-2.73-2.93-3.34-2.97-3.42
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