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Home Inns & Hotels Management Inc (NAS:HMIN)
Beneish M-Score
-2.76 (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.

Home Inns & Hotels Management Inc has a M-score of -2.76 suggests that the company is not a manipulator.

HMIN' s 10-Year Beneish M-Score Range
Min: -2.12   Max: -1.67
Current: -2.76

-2.12
-1.67

During the past 12 years, the highest Beneish M-Score of Home Inns & Hotels Management Inc was -1.67. The lowest was -2.12. And the median was -1.94.


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 Home Inns & Hotels Management Inc 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 * 0.6951+0.528 * 0.9009+0.404 * 0.9714+0.892 * 1.4777+0.115 * 0.7214
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9119+4.679 * -0.0529-0.327 * 1.2848
=-2.76

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

This Year (Sep13) TTM:Last Year (Sep12) TTM:
Accounts Receivable was $18.1 Mil.
Revenue was 267.574963133 + 244.97424193 + 212.459586162 + 221.075699132 = $946.1 Mil.
Gross Profit was 55.1397673275 + 44.4819041409 + 15.2258325251 + 22.8405657345 = $137.7 Mil.
Total Current Assets was $265.8 Mil.
Total Assets was $1,536.6 Mil.
Property, Plant and Equipment(Net PPE) was $642.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $101.9 Mil.
Selling, General & Admin. Expense(SGA) was $65.4 Mil.
Total Current Liabilities was $291.1 Mil.
Long-Term Debt was $297.4 Mil.
Net Income was 17.6967065378 + 15.4468536029 + -3.13368897511 + 1.00932176149 = $31.0 Mil.
Non Operating Income was -5.01327216123 + -1.16547114444 + 0.173941157452 + -1.7987785278 = $-7.8 Mil.
Cash Flow from Operations was 0 + 0 + 0 + 120.183060109 = $120.2 Mil.
Accounts Receivable was $17.7 Mil.
Revenue was 239.726488903 + 213.536095417 + 186.980488579 + 0 = $640.2 Mil.
Gross Profit was 38.7108414498 + 32.2445072191 + 12.9858819797 + 0 = $83.9 Mil.
Total Current Assets was $236.3 Mil.
Total Assets was $1,437.8 Mil.
Property, Plant and Equipment(Net PPE) was $596.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $65.3 Mil.
Selling, General & Admin. Expense(SGA) was $48.6 Mil.
Total Current Liabilities was $307.7 Mil.
Long-Term Debt was $121.0 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)
=(18.1284614124 / 946.084490358) / (17.6500079834 / 640.243072899)
=0.01916157 / 0.02756767
=0.6951

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)
=(44.4819041409 / 640.243072899) / (55.1397673275 / 946.084490358)
=0.13110838 / 0.14553464
=0.9009

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 - (265.767982959 + 642.809765689) / 1536.55857775) / (1 - (236.311192719 + 596.603863963) / 1437.84592049)
=0.40869306 / 0.42072023
=0.9714

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
=946.084490358 / 640.243072899
=1.4777

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))
=(65.3291119202 / (65.3291119202 + 596.603863963)) / (101.8731919 / (101.8731919 + 642.809765689))
=0.09869445 / 0.13680076
=0.7214

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)
=(65.4460649531 / 946.084490358) / (48.5689989721 / 640.243072899)
=0.06917571 / 0.07586025
=0.9119

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)
=((297.419138129 + 291.141733574) / 1536.55857775) / ((120.986587897 + 307.692798978) / 1437.84592049)
=0.38303836 / 0.29814
=1.2848

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
=(31.019192927 - -7.80358067603 - 120.183060109) / 1536.55857775
=-0.0529

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.

Home Inns & Hotels Management Inc has a M-score of -2.76 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.

Home Inns & Hotels Management Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.40341.1740.73381.01981.14041.72770.77891.1041
GMI 1.81761.14581.5970.80210.72861.39281.27770.7788
AQI 0.37143.1291.03061.02860.65943.56281.09170.9343
SGI 2.1321.84491.96121.38941.26151.30181.4821.1317
DEPI 0.88581.30190.76280.71120.99061.23630.75470.9432
SGAI 0.46790.90890.81730.84550.88191.34540.93151.0203
LVGI 0.66611.91980.84960.59010.70292.00320.83080.9382
TATA -0.0859-0.0376-0.0905-0.1383-0.0925-0.0648-0.0806-0.0956
M-score -1.14-1.06-1.91-2.73-2.71-0.96-2.41-2.85

Home Inns & Hotels Management Inc Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.87591.4031.25381.09580.72070.74170.69510.9127
GMI 0.99311.48991.60421.64961.40611.12080.90090.7877
AQI 2.98723.56132.77980.9441.08261.00890.97140.9343
SGI 0.66281.34551.50041.66251.9131.6821.47771.1317
DEPI 1.1231.21531.14551.12170.75720.76010.72140.9432
SGAI 1.33281.27731.12280.6920.64090.69830.91190.9282
LVGI 1.47032.35561.5780.85460.79491.28971.28480.8768
TATA -0.0915-0.0749-0.0867-0.0792-0.0748-0.0639-0.0529-0.0958
M-score -1.80-1.32-1.36-1.74-1.92-2.41-2.76-2.98
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