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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.
Helmerich & Payne Inc has a M-score of -2.78 suggests that the company is not a manipulator.
During the past 13 years, the highest Beneish M-Score of Helmerich & Payne Inc was -2.02. The lowest was -3.52. And the median was -2.78.
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 Helmerich & Payne 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 * 1.0335||+||0.528 * 0.9857||+||0.404 * 0.7218||+||0.892 * 1.098||+||0.115 * 0.9687|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 0.9748||+||4.679 * -0.0676||-||0.327 * 0.9587|
|This Year (Sep14) TTM:||Last Year (Sep13) TTM:|
|Accounts Receivable was $705 Mil.|
Revenue was 985.038 + 952.087 + 893.43 + 889.152 = $3,720 Mil.
Gross Profit was 444.58 + 436.848 + 413.263 + 415.104 = $1,710 Mil.
Total Current Assets was $1,277 Mil.
Total Assets was $6,722 Mil.
Property, Plant and Equipment(Net PPE) was $5,189 Mil.
Depreciation, Depletion and Amortization(DDA) was $524 Mil.
Selling, General & Admin. Expense(SGA) was $135 Mil.
Total Current Liabilities was $508 Mil.
Long-Term Debt was $40 Mil.
Net Income was 168.688 + 192.279 + 174.57 + 173.182 = $709 Mil.
Non Operating Income was -0.605 + 24.228 + 21.32 + -0.345 = $45 Mil.
Cash Flow from Operations was 320.632 + 257.884 + 235.153 + 304.858 = $1,119 Mil.
|Accounts Receivable was $621 Mil.
Revenue was 864.536 + 840.197 + 838.309 + 844.572 = $3,388 Mil.
Gross Profit was 391.366 + 389.207 + 376.572 + 377.701 = $1,535 Mil.
Total Current Assets was $1,258 Mil.
Total Assets was $6,265 Mil.
Property, Plant and Equipment(Net PPE) was $4,676 Mil.
Depreciation, Depletion and Amortization(DDA) was $456 Mil.
Selling, General & Admin. Expense(SGA) was $126 Mil.
Total Current Liabilities was $452 Mil.
Long-Term Debt was $80 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(705.214 / 3719.707)||/||(621.42 / 3387.614)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(436.848 / 3387.614)||/||(444.58 / 3719.707)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (1277.366 + 5188.544) / 6721.861)||/||(1 - (1258.211 + 4676.103) / 6264.827)|
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.
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))|
|=||(455.623 / (455.623 + 4676.103))||/||(523.549 / (523.549 + 5188.544))|
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)|
|=||(135.139 / 3719.707)||/||(126.25 / 3387.614)|
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)|
|=||((40 + 507.526) / 6721.861)||/||((80 + 452.273) / 6264.827)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(708.719 - 44.598||-||1118.527)||/||6721.861|
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.
Helmerich & Payne Inc has a M-score of -2.78 suggests that the company will not be a manipulator.
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
Helmerich & Payne Inc Annual Data
Helmerich & Payne Inc Quarterly Data