HPQ has been removed from your Stock Email Alerts list.
Please enter Portfolio Name for new portfolio.
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.
Hewlett-Packard Co has a M-score of -2.83 suggests that the company is not a manipulator.
During the past 13 years, the highest Beneish M-Score of Hewlett-Packard Co was -1.61. The lowest was -3.87. And the median was -2.59.
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 Hewlett-Packard Co 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 * 0.9981||+||0.528 * 1.0016||+||0.404 * 0.9628||+||0.892 * 0.9445||+||0.115 * 1.0321|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.0386||+||4.679 * -0.064||-||0.327 * 0.946|
* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.
|This Year (Jan14) TTM:||Last Year (Jan13) TTM:|
|Accounts Receivable was $16,546 Mil.|
Revenue was 28154 + 29131 + 27226 + 27582 = $112,093 Mil.
Gross Profit was 6418 + 6694 + 6367 + 6527 = $26,006 Mil.
Total Current Assets was $50,684 Mil.
Total Assets was $105,025 Mil.
Property, Plant and Equipment(Net PPE) was $11,259 Mil.
Depreciation, Depletion and Amortization(DDA) was $4,565 Mil.
Selling, General & Admin. Expense(SGA) was $13,177 Mil.
Total Current Liabilities was $43,611 Mil.
Long-Term Debt was $17,971 Mil.
Net Income was 1425 + 1414 + 1390 + 1077 = $5,306 Mil.
Non Operating Income was 0 + 0 + 0 + -9 = $-9 Mil.
Cash Flow from Operations was 2990 + 2816 + 2674 + 3556 = $12,036 Mil.
|Accounts Receivable was $17,552 Mil.
Revenue was 28359 + 29959 + 29669 + 30693 = $118,680 Mil.
Gross Profit was 6330 + 7248 + 6849 + 7152 = $27,579 Mil.
Total Current Assets was $49,552 Mil.
Total Assets was $106,701 Mil.
Property, Plant and Equipment(Net PPE) was $11,686 Mil.
Depreciation, Depletion and Amortization(DDA) was $4,955 Mil.
Selling, General & Admin. Expense(SGA) was $13,433 Mil.
Total Current Liabilities was $44,386 Mil.
Long-Term Debt was $21,752 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)|
|=||(16546 / 112093)||/||(17552 / 118680)|
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)|
|=||(6694 / 118680)||/||(6418 / 112093)|
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 - (50684 + 11259) / 105025)||/||(1 - (49552 + 11686) / 106701)|
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))|
|=||(4955 / (4955 + 11686))||/||(4565 / (4565 + 11259))|
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)|
|=||(13177 / 112093)||/||(13433 / 118680)|
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)|
|=||((17971 + 43611) / 105025)||/||((21752 + 44386) / 106701)|
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|
|=||(5306 - -9||-||12036)||/||105025|
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.
Hewlett-Packard Co has a M-score of -2.83 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
Hewlett-Packard Co Annual Data
Hewlett-Packard Co Quarterly Data