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Huntsman Corp (NYSE:HUN)
Beneish M-Score
-3.14 (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 -3.14 suggests that the company is not a manipulator.

HUN' s 10-Year Beneish M-Score Range
Min: -4.16   Max: -1.81
Current: -3.14

-4.16
-1.81

During the past 13 years, the highest Beneish M-Score of Huntsman Corp was -1.81. The lowest was -4.16. And the median was -2.62.


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 * 0.508+0.528 * 1.0027+0.404 * 1.0612+0.892 * 1.0142+0.115 * 0.9688
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9746+4.679 * -0.0547-0.327 * 0.9827
=-3.14

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $848 Mil.
Revenue was 2755 + 2705 + 2842 + 2830 = $11,132 Mil.
Gross Profit was 450 + 446 + 507 + 451 = $1,854 Mil.
Total Current Assets was $4,228 Mil.
Total Assets was $9,227 Mil.
Property, Plant and Equipment(Net PPE) was $3,794 Mil.
Depreciation, Depletion and Amortization(DDA) was $464 Mil.
Selling, General & Admin. Expense(SGA) was $945 Mil.
Total Current Liabilities was $2,215 Mil.
Long-Term Debt was $3,621 Mil.
Net Income was 54 + 41 + 64 + 47 = $206 Mil.
Non Operating Income was 3 + -14 + 3 + 4 = $-4 Mil.
Cash Flow from Operations was -67 + 320 + 390 + 72 = $715 Mil.
Accounts Receivable was $1,646 Mil.
Revenue was 2702 + 2619 + 2741 + 2914 = $10,976 Mil.
Gross Profit was 349 + 420 + 537 + 527 = $1,833 Mil.
Total Current Assets was $4,003 Mil.
Total Assets was $8,719 Mil.
Property, Plant and Equipment(Net PPE) was $3,643 Mil.
Depreciation, Depletion and Amortization(DDA) was $430 Mil.
Selling, General & Admin. Expense(SGA) was $956 Mil.
Total Current Liabilities was $2,123 Mil.
Long-Term Debt was $3,489 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)
=(848 / 11132) / (1646 / 10976)
=0.07617679 / 0.14996356
=0.508

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)
=(446 / 10976) / (450 / 11132)
=0.16700073 / 0.16654689
=1.0027

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 - (4228 + 3794) / 9227) / (1 - (4003 + 3643) / 8719)
=0.13059499 / 0.12306457
=1.0612

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
=11132 / 10976
=1.0142

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))
=(430 / (430 + 3643)) / (464 / (464 + 3794))
=0.10557329 / 0.10897135
=0.9688

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 / 11132) / (956 / 10976)
=0.08489041 / 0.08709913
=0.9746

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)
=((3621 + 2215) / 9227) / ((3489 + 2123) / 8719)
=0.6324916 / 0.64365179
=0.9827

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
=(206 - -4 - 715) / 9227
=-0.0547

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 -3.14 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 1.05040.81740.91140.68351.48741.20270.8551.03511.0046
GMI 0.75231.02711.0211.28960.87980.89040.96320.90191.1491
AQI 1.10620.97821.2840.90570.77511.12360.99560.91271.1423
SGI 0.88321.03371.10541.05840.75041.20681.21310.9970.9903
DEPI 0.96940.9461.04061.00560.88071.10570.93431.04520.9862
SGAI 1.10951.17551.03580.95671.28430.83940.88181.03571.0002
LVGI 0.82740.9221.02470.97790.98871.00530.98460.98061.001
TATA -0.0731-0.08790.0122-0.1148-0.20680.0282-0.014-0.0382-0.0587
M-score -2.93-3.03-2.29-3.13-3.44-1.95-2.49-2.71-2.62

Huntsman Corp Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.8550.88570.85220.91421.03510.93921.0481.04961.00460.508
GMI 0.96320.98970.98460.93070.90191.00891.06041.13841.14911.0027
AQI 0.99561.021.09881.00970.91271.00531.03191.05791.14231.0612
SGI 1.21311.16471.09681.01810.9970.95820.95250.98150.99031.0142
DEPI 0.93430.93110.8980.9941.04521.02981.03831.03350.98620.9688
SGAI 0.88180.92140.90270.95991.03571.07981.11631.10011.00020.9746
LVGI 0.98460.96060.97220.94610.98061.02571.02571.03041.0010.9827
TATA -0.014-0.0375-0.041-0.044-0.0382-0.026-0.0254-0.0505-0.0587-0.0547
M-score -2.49-2.59-2.68-2.76-2.71-2.71-2.58-2.61-2.62-3.14
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