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Huntsman Corp (NYSE:HUN)
Beneish M-Score
-2.75 (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.

Huntsman Corp has a M-score of -2.75 suggests that the company is not a manipulator.

HUN' s Beneish M-Score Range Over the Past 10 Years
Min: -4.16   Max: 89.33
Current: -2.75

-4.16
89.33

During the past 13 years, the highest Beneish M-Score of Huntsman Corp was 89.33. The lowest was -4.16. And the median was -2.65.


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 Huntsman Corp 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 * 1.0686+0.528 * 0.933+0.404 * 1.0648+0.892 * 0.882+0.115 * 1.0707
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0972+4.679 * -0.0473-0.327 * 0.9727
=-2.75

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $1,572 Mil.
Revenue was 2355 + 2332 + 2638 + 2740 = $10,065 Mil.
Gross Profit was 416 + 376 + 473 + 549 = $1,814 Mil.
Total Current Assets was $3,830 Mil.
Total Assets was $9,840 Mil.
Property, Plant and Equipment(Net PPE) was $4,437 Mil.
Depreciation, Depletion and Amortization(DDA) was $404 Mil.
Selling, General & Admin. Expense(SGA) was $959 Mil.
Total Current Liabilities was $1,782 Mil.
Long-Term Debt was $4,725 Mil.
Net Income was 56 + 4 + 55 + 29 = $144 Mil.
Non Operating Income was 2 + 4 + -8 + -18 = $-20 Mil.
Cash Flow from Operations was 88 + 188 + 206 + 147 = $629 Mil.
Accounts Receivable was $1,668 Mil.
Revenue was 2589 + 2951 + 2884 + 2988 = $11,412 Mil.
Gross Profit was 450 + 449 + 515 + 505 = $1,919 Mil.
Total Current Assets was $4,887 Mil.
Total Assets was $10,751 Mil.
Property, Plant and Equipment(Net PPE) was $4,250 Mil.
Depreciation, Depletion and Amortization(DDA) was $417 Mil.
Selling, General & Admin. Expense(SGA) was $991 Mil.
Total Current Liabilities was $2,474 Mil.
Long-Term Debt was $4,835 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)
=(1572 / 10065) / (1668 / 11412)
=0.1561848 / 0.14616193
=1.0686

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)
=(1919 / 11412) / (1814 / 10065)
=0.16815633 / 0.18022851
=0.933

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 - (3830 + 4437) / 9840) / (1 - (4887 + 4250) / 10751)
=0.15985772 / 0.15012557
=1.0648

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
=10065 / 11412
=0.882

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))
=(417 / (417 + 4250)) / (404 / (404 + 4437))
=0.08935076 / 0.08345383
=1.0707

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)
=(959 / 10065) / (991 / 11412)
=0.09528068 / 0.08683842
=1.0972

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)
=((4725 + 1782) / 9840) / ((4835 + 2474) / 10751)
=0.66128049 / 0.67984374
=0.9727

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
=(144 - -20 - 629) / 9840
=-0.0473

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.

Huntsman Corp has a M-score of -2.75 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.

Huntsman Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.03091.1090.68351.46861.21810.85221.00630.67211.15750.9203
GMI 0.93280.90831.28930.89940.8710.96320.90191.14910.95460.9237
AQI 0.97821.2840.90570.77511.12360.99560.91271.14231.01991.1725
SGI 0.81960.90841.05850.761.19151.21310.9970.99031.0450.8895
DEPI 0.9461.04081.00540.88071.10570.93431.04520.98621.14721.11
SGAI 1.43351.2060.95641.2830.84020.88181.03571.00020.98941.1334
LVGI 0.9221.02470.97790.98871.00530.98460.98061.0021.04341.0119
TATA -0.0740.0122-0.1148-0.20680.0282-0.014-0.0382-0.0587-0.0378-0.0466
M-score -3.06-2.38-3.13-3.43-1.96-2.49-2.74-2.93-2.48-2.85

Huntsman Corp Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 0.67210.52450.69790.65021.15751.91871.42771.50970.92031.0686
GMI 1.14911.00270.95450.92920.95460.99040.96110.9610.92370.933
AQI 1.14231.06121.00661.01051.01991.14961.21291.21731.17251.0648
SGI 0.99031.01421.03651.03081.0451.02520.98880.96350.88950.882
DEPI 0.98620.96880.9630.94541.14721.21961.31091.29211.111.0707
SGAI 1.00020.97460.96370.94020.98941.02291.05361.09941.13341.0972
LVGI 1.0020.98270.98480.99411.04341.07491.05611.06011.01190.9727
TATA -0.0587-0.0547-0.0433-0.0269-0.0378-0.0519-0.0685-0.0679-0.0466-0.0473
M-score -2.93-3.13-2.94-2.93-2.48-1.80-2.34-2.30-2.85-2.75
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