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HollyFrontier Corp (NYSE:HFC)
Beneish M-Score
-2.93 (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 -2.93 suggests that the company is not a manipulator.

HFC' s Beneish M-Score Range Over the Past 10 Years
Min: -4.61   Max: 1.87
Current: -2.93

-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 -2.36.


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 * 1.0542+0.528 * 0.7158+0.404 * 1.1466+0.892 * 0.7178+0.115 * 1.0664
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3971+4.679 * -0.0329-0.327 * 0.8242
=-2.93

* 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 $522 Mil.
Revenue was 3585.823 + 3701.912 + 3006.626 + 4283.119 = $14,577 Mil.
Gross Profit was 441.115 + 703.752 + 498.203 + -221.748 = $1,421 Mil.
Total Current Assets was $2,308 Mil.
Total Assets was $9,072 Mil.
Property, Plant and Equipment(Net PPE) was $3,977 Mil.
Depreciation, Depletion and Amortization(DDA) was $356 Mil.
Selling, General & Admin. Expense(SGA) was $119 Mil.
Total Current Liabilities was $1,092 Mil.
Long-Term Debt was $983 Mil.
Net Income was 196.322 + 360.824 + 226.876 + -222.204 = $562 Mil.
Non Operating Income was 8.497 + 0.136 + -7.041 + 2.371 = $4 Mil.
Cash Flow from Operations was 333.401 + 323.048 + 246.892 + -47.337 = $856 Mil.
Accounts Receivable was $690 Mil.
Revenue was 5317.555 + 5372.6 + 4791.053 + 4826.801 = $20,308 Mil.
Gross Profit was 410.705 + 426.1 + 378.467 + 202.016 = $1,417 Mil.
Total Current Assets was $3,894 Mil.
Total Assets was $10,182 Mil.
Property, Plant and Equipment(Net PPE) was $3,560 Mil.
Depreciation, Depletion and Amortization(DDA) was $342 Mil.
Selling, General & Admin. Expense(SGA) was $118 Mil.
Total Current Liabilities was $1,787 Mil.
Long-Term Debt was $1,039 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)
=(522.349 / 14577.48) / (690.251 / 20308.009)
=0.0358326 / 0.0339891
=1.0542

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)
=(703.752 / 20308.009) / (441.115 / 14577.48)
=0.06978961 / 0.09750121
=0.7158

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 - (2307.673 + 3977.258) / 9071.637) / (1 - (3893.733 + 3560.265) / 10181.77)
=0.30718888 / 0.26790745
=1.1466

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
=14577.48 / 20308.009
=0.7178

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))
=(341.948 / (341.948 + 3560.265)) / (356.077 / (356.077 + 3977.258))
=0.08762925 / 0.08217158
=1.0664

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)
=(118.604 / 14577.48) / (118.265 / 20308.009)
=0.00813611 / 0.00582356
=1.3971

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)
=((982.846 + 1092.453) / 9071.637) / ((1039.396 + 1786.749) / 10181.77)
=0.22876786 / 0.27756913
=0.8242

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
=(561.818 - 3.963 - 856.004) / 9071.637
=-0.0329

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 -2.93 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.9910.75011.29650.38393.20250.75660.38480.68761.11370.8489
GMI 0.94131.00850.9571.22071.99730.91320.41630.80411.94721.6552
AQI 0.32820.81412.23181.53880.81320.88054.16810.9491.06631.094
SGI 1.43951.32071.1911.2230.82491.72171.85511.30131.00350.9803
DEPI 0.94271.34741.1941.4670.89540.91861.26140.70360.8610.9109
SGAI 0.70830.92670.91290.65721.32330.68190.9140.81960.99550.9136
LVGI 1.1090.89131.0880.87261.28371.07940.54550.89290.91760.9404
TATA -0.07820.0068-0.0647-0.0214-0.0607-0.0491-0.03160.0059-0.0109-0.0508
M-score -2.76-2.37-1.86-2.46-0.60-2.36-1.27-2.56-1.88-2.47

HollyFrontier Corp Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 1.2470.99721.11371.02891.01420.92120.84890.86180.99981.0542
GMI 0.94521.34451.94722.4662.41291.57621.65521.12160.73140.7158
AQI 0.9631.05471.06631.04330.98241.01311.0941.12581.15521.1466
SGI 1.02391.02841.00351.0190.9980.99150.98030.88820.80270.7178
DEPI 0.82460.86050.8610.89520.86160.9160.91090.94981.08021.0664
SGAI 0.89150.98680.99550.95050.91370.90490.91361.05041.19341.3971
LVGI 0.89820.8330.91760.9931.04731.0070.94040.85780.82980.8242
TATA -0.0076-0.0196-0.0109-0.0413-0.0626-0.0289-0.0508-0.0267-0.0066-0.0329
M-score -2.28-2.30-1.88-1.84-2.04-2.38-2.47-2.68-2.73-2.93
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