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Huntsman Corp (NYSE:HUN)
Beneish M-Score
-2.50 (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 -2.50 suggests that the company is not a manipulator.

HUN' s 10-Year Beneish M-Score Range
Min: -3.44   Max: -1.95
Current: -2.5

-3.44
-1.95

During the past 13 years, the highest Beneish M-Score of Huntsman Corp was -1.95. The lowest was -3.44. And the median was -2.74.


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 * 1.1181+0.528 * 0.9546+0.404 * 1.0673+0.892 * 1.045+0.115 * 1.1472
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9894+4.679 * -0.0375-0.327 * 1.0473
=-2.50

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $1,193 Mil.
Revenue was 2951 + 2884 + 2988 + 2755 = $11,578 Mil.
Gross Profit was 449 + 515 + 505 + 450 = $1,919 Mil.
Total Current Assets was $5,039 Mil.
Total Assets was $11,002 Mil.
Property, Plant and Equipment(Net PPE) was $4,423 Mil.
Depreciation, Depletion and Amortization(DDA) was $445 Mil.
Selling, General & Admin. Expense(SGA) was $974 Mil.
Total Current Liabilities was $2,332 Mil.
Long-Term Debt was $4,939 Mil.
Net Income was -38 + 188 + 119 + 54 = $323 Mil.
Non Operating Income was -30 + 1 + 2 + 3 = $-24 Mil.
Cash Flow from Operations was 417 + 360 + 50 + -67 = $760 Mil.
Accounts Receivable was $1,021 Mil.
Revenue was 2705 + 2842 + 2830 + 2702 = $11,079 Mil.
Gross Profit was 446 + 507 + 451 + 349 = $1,753 Mil.
Total Current Assets was $4,159 Mil.
Total Assets was $9,188 Mil.
Property, Plant and Equipment(Net PPE) was $3,824 Mil.
Depreciation, Depletion and Amortization(DDA) was $448 Mil.
Selling, General & Admin. Expense(SGA) was $942 Mil.
Total Current Liabilities was $2,159 Mil.
Long-Term Debt was $3,639 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)
=(1193 / 11578) / (1021 / 11079)
=0.10304025 / 0.09215633
=1.1181

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)
=(515 / 11079) / (449 / 11578)
=0.15822728 / 0.16574538
=0.9546

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 - (5039 + 4423) / 11002) / (1 - (4159 + 3824) / 9188)
=0.13997455 / 0.13114933
=1.0673

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
=11578 / 11079
=1.045

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))
=(448 / (448 + 3824)) / (445 / (445 + 4423))
=0.10486891 / 0.09141331
=1.1472

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)
=(974 / 11578) / (942 / 11079)
=0.08412506 / 0.08502572
=0.9894

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)
=((4939 + 2332) / 11002) / ((3639 + 2159) / 9188)
=0.66087984 / 0.63104049
=1.0473

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
=(323 - -24 - 760) / 11002
=-0.0375

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 -2.50 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.05040.81740.91140.68351.48741.20270.85221.00630.67211.1181
GMI 0.75231.02711.0211.28960.87980.89040.96320.90191.14910.9546
AQI 1.10620.97821.2840.90570.77511.12360.99560.91271.14231.0673
SGI 0.88321.03371.10541.05840.75041.20681.21310.9970.99031.045
DEPI 0.96940.9461.04061.00560.88071.10570.93431.04520.98621.1472
SGAI 1.10951.17551.03580.95671.28430.83940.88181.03571.00020.9894
LVGI 0.82740.9221.02470.97790.98871.00530.98460.98061.0021.0473
TATA -0.0731-0.08790.0122-0.1148-0.20680.0282-0.014-0.0382-0.0587-0.0375
M-score -2.93-3.03-2.29-3.13-3.44-1.95-2.49-2.74-2.93-2.50

Huntsman Corp Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 0.89931.00630.92371.05491.04890.67210.52450.69790.65021.1181
GMI 0.93070.90191.00891.06041.13841.14911.00270.95450.92920.9546
AQI 1.00970.91271.00531.03191.05791.14231.06121.00661.01051.0673
SGI 1.01810.9970.95820.95250.98150.99031.01421.03651.03081.045
DEPI 0.9941.04521.02981.03831.03350.98620.96880.9630.94541.1472
SGAI 0.95991.03571.07981.11631.10011.00020.97460.96370.94020.9894
LVGI 0.94610.98061.02571.02571.03041.0020.98270.98480.99411.0473
TATA -0.044-0.0382-0.026-0.0254-0.0505-0.0587-0.0547-0.0433-0.0269-0.0375
M-score -2.77-2.74-2.72-2.57-2.61-2.93-3.13-2.94-2.93-2.50
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