WPG (Shanghai) Smart Water PCL (SHSE:603956) Beneish M-Score : -2.06 (As of May. 15, 2024)

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What is WPG (Shanghai) Smart Water PCL Beneish M-Score?

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.06 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for WPG (Shanghai) Smart Water PCL's Beneish M-Score or its related term are showing as below:

SHSE:603956' s Beneish M-Score Range Over the Past 10 Years
Min: -2.54 Med: -2.06 Max: -1.43
Current: -2.06

During the past 10 years, the highest Beneish M-Score of WPG (Shanghai) Smart Water PCL was -1.43. The lowest was -2.54. And the median was -2.06.

WPG (Shanghai) Smart Water PCL Beneish M-Score Historical Data

The historical data trend for WPG (Shanghai) Smart Water PCL's Beneish M-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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WPG (Shanghai) Smart Water PCL Beneish M-Score Chart

WPG (Shanghai) Smart Water PCL Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.05

-2.28

-1.49

-2.37

-2.24

WPG (Shanghai) Smart Water PCL Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
Beneish M-Score	Get a 7-Day Free Trial															-2.52	-2.54	-2.27	-2.24	-2.06

Competitive Comparison of WPG (Shanghai) Smart Water PCL's Beneish M-Score

For the Specialty Industrial Machinery subindustry, WPG (Shanghai) Smart Water PCL's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

WPG (Shanghai) Smart Water PCL's Beneish M-Score Distribution in the Industrial Products Industry

For the Industrial Products industry and Industrials sector, WPG (Shanghai) Smart Water PCL's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where WPG (Shanghai) Smart Water PCL's Beneish M-Score falls into.

WPG (Shanghai) Smart Water PCL Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 WPG (Shanghai) Smart Water PCL for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 0.8723

0.528 * 1.0881

0.404 * 0.9981

0.892 * 1.3377

0.115 * 1

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.7031

4.679 * 0.035857

0.327 * 1.0907

-2.06

This Year (Mar24) TTM:

Last Year (Mar23) TTM:

Total Receivables was ¥1,053 Mil.
Revenue was 214.419 + 646.037 + 323.502 + 291.184 = ¥1,475 Mil.
Gross Profit was 114.448 + 316.034 + 170.468 + 144.388 = ¥745 Mil.
Total Current Assets was ¥1,992 Mil.
Total Assets was ¥3,369 Mil.
Property, Plant and Equipment(Net PPE) was ¥766 Mil.
Depreciation, Depletion and Amortization(DDA) was ¥0 Mil.
Selling, General, & Admin. Expense(SGA) was ¥424 Mil.
Total Current Liabilities was ¥921 Mil.
Long-Term Debt & Capital Lease Obligation was ¥422 Mil.
Net Income was -37.502 + 82.108 + 2.975 + -17.326 = ¥30 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = ¥0 Mil.
Cash Flow from Operations was -218.87 + 193.478 + -17.216 + -47.941 = ¥-91 Mil.

Total Receivables was ¥903 Mil.
Revenue was 156.477 + 539.671 + 199.451 + 207.183 = ¥1,103 Mil.
Gross Profit was 88.42 + 307.165 + 105.001 + 105.723 = ¥606 Mil.
Total Current Assets was ¥2,085 Mil.
Total Assets was ¥3,291 Mil.
Property, Plant and Equipment(Net PPE) was ¥608 Mil.
Depreciation, Depletion and Amortization(DDA) was ¥0 Mil.
Selling, General, & Admin. Expense(SGA) was ¥451 Mil.
Total Current Liabilities was ¥821 Mil.
Long-Term Debt & Capital Lease Obligation was ¥381 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total 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)
	=	(1053.04 / 1475.142)	/	(902.503 / 1102.782)
	=	0.713857	/	0.818387
	=	0.8723

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)
	=	(606.309 / 1102.782)	/	(745.338 / 1475.142)
	=	0.5498	/	0.505265
	=	1.0881

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 Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (1991.564 + 766.046) / 3369.056)	/	(1 - (2084.567 + 608.091) / 3291.065)
	=	0.181489	/	0.181828
	=	0.9981

4. SGI = Sales Growth Index

Ratio of Revenue 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
	=	1475.142	/	1102.782
	=	1.3377

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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))
	=	(0 / (0 + 608.091))	/	(0 / (0 + 766.046))
	=	0	/	0
	=	1

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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)
	=	(424.362 / 1475.142)	/	(451.216 / 1102.782)
	=	0.287675	/	0.409162
	=	0.7031

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 in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((421.534 + 920.634) / 3369.056)	/	((381.358 + 820.707) / 3291.065)
	=	0.398381	/	0.365251
	=	1.0907

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
	=	(30.255 - 0	-	-90.549)	/	3369.056
	=	0.035857

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

WPG (Shanghai) Smart Water PCL has a M-score of -2.06 suggests that the company is unlikely to be a manipulator.

WPG (Shanghai) Smart Water PCL Beneish M-Score Related Terms

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WPG (Shanghai) Smart Water PCL (SHSE:603956) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Industrial Products » WPG (Shanghai) Smart Water PCL (SHSE:603956) » Definitions » Beneish M-Score

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Address

No. 1 Hengyong Road, Jiading District, Shanghai, CHN, 201806

Website

https://www.shwpg.com

WPG (Shanghai) Smart Water PCL is a smart water solutions provider, is a professional technology service company dedicated to solving various problems arising in water supply for customers. Its core business includes the development, production, sales and service of secondary water supply Zhilian equipment with the concept of industrial Internet, the deployment, commissioning and maintenance of the intelligent water supply management platform system, providing safe, energy-saving and efficient operation for secondary water supply.

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