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Tenet Healthcare Corp (NYSE:THC)
Beneish M-Score
0.00 (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.

Tenet Healthcare Corp has a M-score of signals that the company is a manipulator.

During the past 13 years, the highest Beneish M-Score of Tenet Healthcare Corp was -1.91. The lowest was -3.64. And the median was -2.72.


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 Tenet Healthcare 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 * +0.528 * +0.404 * +0.892 * +0.115 *
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * +4.679 * -0.327 *
=

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

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $2,704 Mil.
Revenue was 5026 + 4692 + 4492 + 4428 = $18,638 Mil.
Gross Profit was 1766 + 1682 + 1600 + 1616 = $6,664 Mil.
Total Current Assets was $5,171 Mil.
Total Assets was $23,682 Mil.
Property, Plant and Equipment(Net PPE) was $7,915 Mil.
Depreciation, Depletion and Amortization(DDA) was $797 Mil.
Selling, General & Admin. Expense(SGA) was $0 Mil.
Total Current Liabilities was $4,308 Mil.
Long-Term Debt was $14,383 Mil.
Net Income was -97 + -29 + -61 + 47 = $-140 Mil.
Non Operating Income was 0 + 1 + -1 + 0 = $0 Mil.
Cash Flow from Operations was 191 + 482 + 410 + -57 = $1,026 Mil.
Accounts Receivable was $2,404 Mil.
Revenue was 4465 + 4175 + 4038 + 3926 = $16,604 Mil.
Gross Profit was 1659 + 1482 + 1433 + 1377 = $5,951 Mil.
Total Current Assets was $3,970 Mil.
Total Assets was $17,951 Mil.
Property, Plant and Equipment(Net PPE) was $7,733 Mil.
Depreciation, Depletion and Amortization(DDA) was $849 Mil.
Selling, General & Admin. Expense(SGA) was $0 Mil.
Total Current Liabilities was $3,577 Mil.
Long-Term Debt was $11,505 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)
=(2704 / 18638) / (2404 / 16604)
=0.14507994 / 0.14478439
=

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)
=(1682 / 16604) / (1766 / 18638)
=0.35840761 / 0.35754909
=

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 - (5171 + 7915) / 23682) / (1 - (3970 + 7733) / 17951)
=0.44742843 / 0.3480586
=

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
=18638 / 16604
=

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))
=(849 / (849 + 7733)) / (797 / (797 + 7915))
=0.09892799 / 0.09148301
=

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)
=(0 / 18638) / (0 / 16604)
=0 / 0
=

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)
=((14383 + 4308) / 23682) / ((11505 + 3577) / 17951)
=0.78924922 / 0.84017603
=

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
=(-140 - 0 - 1026) / 23682
=-0.0492

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.

Tenet Healthcare Corp has a M-score of signals that the company is likely to 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.

Tenet Healthcare Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.86991.0251
GMI 0.96910.9815
AQI 0.82910.9948
SGI 1.01530.9562
DEPI 0.90931.0776
SGAI 0.99970
LVGI 1.08561.0378
TATA -0.0473-0.055
M-score -2.93-2.60

Tenet Healthcare Corp Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI
GMI
AQI
SGI
DEPI
SGAI
LVGI
TATA
M-score
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