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Huntsman Corp (NYSE:HUN)
Beneish M-Score
-2.93 (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 -2.93 suggests that the company is not a manipulator.

HUN' s 10-Year Beneish M-Score Range
Min: -4.16   Max: 90.02
Current: -2.93

-4.16
90.02

During the past 13 years, the highest Beneish M-Score of Huntsman Corp was 90.02. 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 * 0.6502+0.528 * 0.9292+0.404 * 1.0105+0.892 * 1.0308+0.115 * 0.9454
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9402+4.679 * -0.0269-0.327 * 0.9941
=-2.93

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $1,122 Mil.
Revenue was 2884 + 2988 + 2755 + 2705 = $11,332 Mil.
Gross Profit was 515 + 505 + 450 + 446 = $1,916 Mil.
Total Current Assets was $4,494 Mil.
Total Assets was $9,409 Mil.
Property, Plant and Equipment(Net PPE) was $3,703 Mil.
Depreciation, Depletion and Amortization(DDA) was $457 Mil.
Selling, General & Admin. Expense(SGA) was $945 Mil.
Total Current Liabilities was $2,122 Mil.
Long-Term Debt was $3,758 Mil.
Net Income was 188 + 119 + 54 + 41 = $402 Mil.
Non Operating Income was 1 + 2 + 3 + -14 = $-8 Mil.
Cash Flow from Operations was 360 + 50 + -67 + 320 = $663 Mil.
Accounts Receivable was $1,674 Mil.
Revenue was 2842 + 2830 + 2702 + 2619 = $10,993 Mil.
Gross Profit was 507 + 451 + 349 + 420 = $1,727 Mil.
Total Current Assets was $4,126 Mil.
Total Assets was $9,021 Mil.
Property, Plant and Equipment(Net PPE) was $3,745 Mil.
Depreciation, Depletion and Amortization(DDA) was $434 Mil.
Selling, General & Admin. Expense(SGA) was $975 Mil.
Total Current Liabilities was $2,097 Mil.
Long-Term Debt was $3,574 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)
=(1122 / 11332) / (1674 / 10993)
=0.09901165 / 0.15227872
=0.6502

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)
=(505 / 10993) / (515 / 11332)
=0.15709997 / 0.16907872
=0.9292

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 - (4494 + 3703) / 9409) / (1 - (4126 + 3745) / 9021)
=0.12881284 / 0.12748032
=1.0105

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
=11332 / 10993
=1.0308

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))
=(434 / (434 + 3745)) / (457 / (457 + 3703))
=0.1038526 / 0.10985577
=0.9454

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)
=(945 / 11332) / (975 / 10993)
=0.08339216 / 0.0886928
=0.9402

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)
=((3758 + 2122) / 9409) / ((3574 + 2097) / 9021)
=0.62493357 / 0.62864427
=0.9941

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
=(402 - -8 - 663) / 9409
=-0.0269

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 -2.93 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.05040.81740.91140.68351.46861.21810.85221.00631.015
GMI 0.75231.02711.0211.28960.89940.8710.96320.90191.1491
AQI 1.10620.97821.2840.90570.77511.12360.99560.91271.1423
SGI 0.88321.03371.10541.05840.761.19151.21310.9970.9903
DEPI 0.96940.9461.04061.00560.88071.10570.93431.04520.9862
SGAI 1.10951.17551.03580.95671.2830.84020.88181.03571.0002
LVGI 0.82740.9221.02470.97790.98871.00530.98460.98131.0002
TATA -0.0731-0.08790.0122-0.1148-0.20680.0282-0.014-0.0382-0.0587
M-score -2.93-3.03-2.29-3.13-3.43-1.96-2.49-2.74-2.61

Huntsman Corp Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.83280.89931.00630.92371.05491.04891.0150.52450.69790.6502
GMI 0.98460.93070.90191.00891.06041.13841.14911.00270.95450.9292
AQI 1.09881.00970.91271.00531.03191.05791.14231.06121.00661.0105
SGI 1.09681.01810.9970.95820.95250.98150.99031.01421.03651.0308
DEPI 0.8980.9941.04521.02981.03831.03350.98620.96880.9630.9454
SGAI 0.90270.95991.03571.07981.11631.10011.00020.97460.96370.9402
LVGI 0.97220.94610.98131.02571.02571.03041.00020.98270.98480.9941
TATA -0.041-0.0442-0.0382-0.026-0.0254-0.0504-0.0587-0.0547-0.0433-0.0269
M-score -2.69-2.77-2.74-2.72-2.57-2.61-2.61-3.13-2.94-2.93
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