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Helmerich & Payne Inc (NYSE:HP)
Beneish M-Score
-2.62 (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 -2.62 suggests that the company is not a manipulator.

HP' s 10-Year Beneish M-Score Range
Min: -3.94   Max: -2.02
Current: -2.62

-3.94
-2.02

During the past 13 years, the highest Beneish M-Score of Helmerich & Payne Inc was -2.02. The lowest was -3.94. And the median was -2.72.


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 * 1.0562+0.528 * 0.9887+0.404 * 0.9113+0.892 * 1.0736+0.115 * 0.9858
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9817+4.679 * -0.0571-0.327 * 0.8585
=-2.62

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $706 Mil.
Revenue was 952.087 + 893.43 + 889.152 + 864.536 = $3,599 Mil.
Gross Profit was 436.848 + 413.263 + 415.104 + 391.366 = $1,657 Mil.
Total Current Assets was $1,450 Mil.
Total Assets was $6,693 Mil.
Property, Plant and Equipment(Net PPE) was $4,944 Mil.
Depreciation, Depletion and Amortization(DDA) was $492 Mil.
Selling, General & Admin. Expense(SGA) was $131 Mil.
Total Current Liabilities was $502 Mil.
Long-Term Debt was $80 Mil.
Net Income was 192.279 + 174.57 + 173.182 + 159.797 = $700 Mil.
Non Operating Income was 24.228 + 21.32 + -0.345 + 3.186 = $48 Mil.
Cash Flow from Operations was 257.884 + 235.153 + 304.858 + 235.542 = $1,033 Mil.
Accounts Receivable was $622 Mil.
Revenue was 840.197 + 838.309 + 844.572 + 829.447 = $3,353 Mil.
Gross Profit was 389.207 + 376.572 + 377.701 + 382.112 = $1,526 Mil.
Total Current Assets was $1,280 Mil.
Total Assets was $6,198 Mil.
Property, Plant and Equipment(Net PPE) was $4,613 Mil.
Depreciation, Depletion and Amortization(DDA) was $452 Mil.
Selling, General & Admin. Expense(SGA) was $124 Mil.
Total Current Liabilities was $433 Mil.
Long-Term Debt was $195 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)
=(705.787 / 3599.205) / (622.405 / 3352.525)
=0.19609525 / 0.18565261
=1.0562

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)
=(413.263 / 3352.525) / (436.848 / 3599.205)
=0.45505761 / 0.46026303
=0.9887

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 - (1450.421 + 4943.66) / 6693.082) / (1 - (1280.49 + 4613.301) / 6197.611)
=0.04467314 / 0.04902212
=0.9113

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
=3599.205 / 3352.525
=1.0736

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))
=(451.967 / (451.967 + 4613.301)) / (491.979 / (491.979 + 4943.66))
=0.08922864 / 0.09050987
=0.9858

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)
=(130.799 / 3599.205) / (124.11 / 3352.525)
=0.03634108 / 0.03701986
=0.9817

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)
=((80 + 502.111) / 6693.082) / ((195 + 432.854) / 6197.611)
=0.08697204 / 0.10130581
=0.8585

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
=(699.828 - 48.389 - 1033.437) / 6693.082
=-0.0571

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 -2.62 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

Sep04Sep05Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13
DSRI 1.25480.89791.16360.88231.08990.57331.87310.74181.08740.9393
GMI 1.08170.73590.85950.97661.00961.00111.08780.98050.98260.9813
AQI 1.0250.94320.95640.7760.741.49170.88470.93571.11960.6364
SGI 1.16591.35931.52961.33051.24970.930.991.35661.2391.0748
DEPI 0.8390.96731.39331.00890.87211.07920.90930.93960.96620.9211
SGAI 0.78780.80120.82680.68680.96331.11961.38520.82730.94711.0946
LVGI 0.90750.9421.18311.13040.93870.7940.80090.93740.77320.8436
TATA -0.08-0.0765-0.0177-0.0846-0.0588-0.1309-0.0722-0.1086-0.0733-0.0675
M-score -2.37-2.72-2.02-2.78-2.54-3.29-2.04-2.90-2.41-2.92

Helmerich & Payne Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.92891.0811.08740.96231.00840.92870.93931.0330.98861.0562
GMI 0.97550.98670.98261.0060.97690.96170.98130.96140.97070.9887
AQI 0.80790.76011.11960.97271.00860.66730.63640.64970.53120.9113
SGI 1.27041.25851.2391.2171.17021.1091.07481.05161.04661.0736
DEPI 0.97610.98620.96620.94860.9240.88930.92110.9160.94530.9858
SGAI 0.9410.92090.94710.95491.00221.09051.09461.05571.02860.9817
LVGI 0.95290.94330.77320.83050.72830.86190.84360.83120.96180.8585
TATA -0.0843-0.063-0.0733-0.087-0.074-0.0926-0.0675-0.0569-0.0687-0.0571
M-score -2.77-2.54-2.41-2.68-2.60-3.02-2.92-2.80-2.97-2.62
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