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Helmerich & Payne Inc (NYSE:HP)
Beneish M-Score
-4.20 (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.

Helmerich & Payne Inc has a M-score of -4.20 suggests that the company is not a manipulator.

HP' s Beneish M-Score Range Over the Past 10 Years
Min: -4.2   Max: -2.01
Current: -4.2

-4.2
-2.01

During the past 13 years, the highest Beneish M-Score of Helmerich & Payne Inc was -2.01. The lowest was -4.20. And the median was -2.69.


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 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 * 0.763+0.528 * 1.0242+0.404 * 0.6116+0.892 * 0.6673+0.115 * 0.9163
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.4813+4.679 * -0.1538-0.327 * 1.764
=-4.20

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

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $374 Mil.
Revenue was 487.847 + 566.11 + 659.694 + 883.052 = $2,597 Mil.
Gross Profit was 211.203 + 237.188 + 308.024 + 413.724 = $1,170 Mil.
Total Current Assets was $1,477 Mil.
Total Assets was $7,130 Mil.
Property, Plant and Equipment(Net PPE) was $5,531 Mil.
Depreciation, Depletion and Amortization(DDA) was $611 Mil.
Selling, General & Admin. Expense(SGA) was $134 Mil.
Total Current Liabilities was $409 Mil.
Long-Term Debt was $493 Mil.
Net Income was 16.002 + -21.214 + 90.86 + 149.537 = $235 Mil.
Non Operating Income was -0.261 + -0.989 + -0.281 + 0.055 = $-1 Mil.
Cash Flow from Operations was 308.196 + 271.205 + 334.955 + 419.275 = $1,334 Mil.
Accounts Receivable was $734 Mil.
Revenue was 1060.787 + 985.038 + 952.087 + 893.43 = $3,891 Mil.
Gross Profit was 501.324 + 444.58 + 436.848 + 413.263 = $1,796 Mil.
Total Current Assets was $1,210 Mil.
Total Assets was $6,802 Mil.
Property, Plant and Equipment(Net PPE) was $5,400 Mil.
Depreciation, Depletion and Amortization(DDA) was $542 Mil.
Selling, General & Admin. Expense(SGA) was $136 Mil.
Total Current Liabilities was $447 Mil.
Long-Term Debt was $40 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)
=(373.896 / 2596.703) / (734.329 / 3891.342)
=0.14398874 / 0.18870842
=0.763

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)
=(237.188 / 3891.342) / (211.203 / 2596.703)
=0.46154129 / 0.45062489
=1.0242

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 - (1476.676 + 5530.817) / 7130.274) / (1 - (1209.992 + 5400.016) / 6801.519)
=0.01721967 / 0.02815709
=0.6116

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
=2596.703 / 3891.342
=0.6673

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))
=(541.544 / (541.544 + 5400.016)) / (610.889 / (610.889 + 5530.817))
=0.09114509 / 0.09946569
=0.9163

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)
=(134.073 / 2596.703) / (135.632 / 3891.342)
=0.05163201 / 0.03485481
=1.4813

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)
=((492.668 + 408.79) / 7130.274) / ((40 + 447.456) / 6801.519)
=0.12642684 / 0.0716687
=1.764

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
=(235.185 - -1.476 - 1333.631) / 7130.274
=-0.1538

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 -4.20 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.

Helmerich & Payne Inc Annual Data

Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15
DSRI 1.13910.8961.09630.54351.76980.82811.08740.93181.03350.7487
GMI 0.85950.97661.00961.00111.08780.98050.98260.98130.98570.9957
AQI 0.95640.7760.741.77880.74190.93571.11960.63640.72040.5362
SGI 1.52961.33051.24970.930.991.35661.2391.07481.0980.851
DEPI 1.39331.00890.87211.05710.92820.93960.96620.92110.96870.9323
SGAI 0.82680.68680.96331.11961.38520.82730.94711.09460.97481.1731
LVGI 1.18311.13040.93870.7940.80090.93740.77320.84360.95731.4503
TATA -0.0108-0.0609-0.0473-0.1309-0.0722-0.1086-0.0733-0.0675-0.0676-0.1392
M-score -2.01-2.66-2.48-3.21-2.19-2.82-2.41-2.92-2.78-3.87

Helmerich & Payne Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.93181.0330.98861.05621.03351.02770.8980.69660.74770.763
GMI 0.98130.96140.97070.98870.98570.99250.99670.99040.99771.0242
AQI 0.63640.64970.53120.91130.72040.55450.60160.62190.53620.6116
SGI 1.07481.05161.04661.07361.0981.13381.11290.9970.85210.6673
DEPI 0.92110.9160.94530.98580.96870.99720.98620.96610.93230.9163
SGAI 1.09461.05571.02860.98170.97480.94890.95791.00671.171.4813
LVGI 0.84360.83120.96180.85850.95730.82231.57451.37751.45031.764
TATA -0.0675-0.0569-0.0687-0.0571-0.0676-0.0754-0.0954-0.1165-0.1391-0.1538
M-score -2.92-2.80-2.97-2.62-2.78-2.81-3.26-3.59-3.87-4.20
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