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ARES (Ares Management) Beneish M-Score : -2.42 (As of Dec. 15, 2024)


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What is Ares Management 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 -2.42 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Ares Management's Beneish M-Score or its related term are showing as below:

ARES' s Beneish M-Score Range Over the Past 10 Years
Min: -2.82   Med: -1.77   Max: -0.61
Current: -2.42

During the past 13 years, the highest Beneish M-Score of Ares Management was -0.61. The lowest was -2.82. And the median was -1.77.


Ares Management Beneish M-Score Historical Data

The historical data trend for Ares Management'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.

* Premium members only.

Ares Management Beneish M-Score Chart

Ares Management Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Beneish M-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only -1.48 -1.83 -1.03 -2.10 -2.22

Ares Management Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
Beneish M-Score Get a 7-Day Free Trial Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.31 -2.22 -2.30 -2.32 -2.42

Competitive Comparison of Ares Management's Beneish M-Score

For the Asset Management subindustry, Ares Management'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.


Ares Management's Beneish M-Score Distribution in the Asset Management Industry

For the Asset Management industry and Financial Services sector, Ares Management's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Ares Management's Beneish M-Score falls into.



Ares Management 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 Ares Management 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 * 1.13+0.528 * 1.0296+0.404 * 0.9677+0.892 * 1.0827+0.115 * 1
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.7772+4.679 * -0.03872-0.327 * 0.9675
=-2.42

* 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.

This Year (Sep24) TTM:Last Year (Sep23) TTM:
Total Receivables was $1,047 Mil.
Revenue was 1431.73 + 1137.92 + 1014.961 + 1490.859 = $5,075 Mil.
Gross Profit was 995.854 + 718.062 + 602.01 + 1099.994 = $3,416 Mil.
Total Current Assets was $2,713 Mil.
Total Assets was $24,523 Mil.
Property, Plant and Equipment(Net PPE) was $426 Mil.
Depreciation, Depletion and Amortization(DDA) was $0 Mil.
Selling, General, & Admin. Expense(SGA) was $1,042 Mil.
Total Current Liabilities was $4,094 Mil.
Long-Term Debt & Capital Lease Obligation was $14,148 Mil.
Net Income was 118.46 + 94.938 + 73.027 + 173.95 = $460 Mil.
Non Operating Income was -18.805 + -0.938 + 0.27 + 5.887 = $-14 Mil.
Cash Flow from Operations was 841.319 + 432.172 + 710.045 + -560.052 = $1,423 Mil.
Total Receivables was $856 Mil.
Revenue was 1009.428 + 1434.337 + 1052.354 + 1191.83 = $4,688 Mil.
Gross Profit was 641.926 + 1066.787 + 691.573 + 848.271 = $3,249 Mil.
Total Current Assets was $2,053 Mil.
Total Assets was $23,384 Mil.
Property, Plant and Equipment(Net PPE) was $260 Mil.
Depreciation, Depletion and Amortization(DDA) was $0 Mil.
Selling, General, & Admin. Expense(SGA) was $1,238 Mil.
Total Current Liabilities was $3,770 Mil.
Long-Term Debt & Capital Lease Obligation was $14,209 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)
=(1047.254 / 5075.47) / (856.037 / 4687.949)
=0.206336 / 0.182604
=1.13

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)
=(3248.557 / 4687.949) / (3415.92 / 5075.47)
=0.692959 / 0.673025
=1.0296

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 - (2713.306 + 426.483) / 24522.65) / (1 - (2053.182 + 259.537) / 23383.893)
=0.871964 / 0.901098
=0.9677

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
=5075.47 / 4687.949
=1.0827

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 + 259.537)) / (0 / (0 + 426.483))
=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)
=(1041.897 / 5075.47) / (1238.156 / 4687.949)
=0.205281 / 0.264115
=0.7772

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)
=((14148.305 + 4093.776) / 24522.65) / ((14208.779 + 3769.88) / 23383.893)
=0.743887 / 0.768848
=0.9675

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
=(460.375 - -13.586 - 1423.484) / 24522.65
=-0.03872

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.

Ares Management has a M-score of -2.42 suggests that the company is unlikely to be a manipulator.


Ares Management Beneish M-Score Related Terms

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Ares Management Business Description

Traded in Other Exchanges
Address
2000 Avenue of the Stars, 12th Floor, Los Angeles, CA, USA, 90067
Ares Management Corp is an asset management company. It offers investors investment-related advice and strategies for capital growth. The company's operating segments include Credit Group, Private Equity Group, Real Assets and Secondaries Group. Its Credit Group generates maximum revenue, and manages credit strategies across the liquid and illiquid spectrum. Private Equity Group manages investment strategies categorized as corporate private equity, infrastructure and power, and special opportunities, Real Estate Group manages comprehensive equity and debt strategies across real estate and infrastructure investments. The Secondaries Group invests in secondary markets across a range of alternative asset class strategies, including private equity, real estate, infrastructure and credit.
Executives
Michael J Arougheti director, officer: Co-Founder & President 2000 AVENUE OF THE STARS, 12TH FLOOR, LOS ANGELES CA 90067
Bennett Rosenthal director, officer: Co-Founder & Senior Partner 2000 AVENUE OF THE STARS, 12TH FLOOR, LOS ANGELES CA 90067
David B Kaplan director, officer: Co-Founder & Senior Partner 1999 AVENUE OF THE STARS, SUITE 1900, LOS ANGELES CA 90067
Ryan Berry officer: Ptr, Chief Mktg. & Strat. Off. C/O ARES MANAGEMENT LLC, 2000 AVENUE OF THE STARS, 12TH FLOOR, LOS ANGELES CA 90067
R. Kipp Deveer officer: Partner 245 PARK AVENUE, 44TH FLOOR, NEW YORK NY 10167
Judy D. Olian director 2000 AVENUE OF THE STARS 12TH FL, LOS ANGELES CA 90067
Antony P Ressler director, officer: Chairman, CEO, Co-Founder 1999 AVENUE OF THE STARS, SUITE 1900, LOS ANGELES CA 90067
Ashish Bhutani director
Aghili Naseem Sagati officer: General Counsel 2000 AVENUE OF THE STARS, LOS ANGELES CA 90067
Bush Antoinette Cook director NORTHPOINT TECHNOLOGY, 444 N CAPITOL STREET NW STE 645, WASHINGTON DC 20001
Eileen Naughton director C/O GOOGLE INC., 76 NINTH AVENUE, 4TH FLOOR, NEW YORK NY 10011
Ares Management Corp officer: Chief Financial Officer 2000 AVE OF THE STARS, 12TH FLOOR, LOS ANGELES CA 90067
Jarrod Phillips officer: Chief Financial Officer C/O ARES MANAGEMENT LLC, 245 PARK AVENUE, 42ND FLOOR, NEW YORK NY 100167
Michael R Mcferran officer: EVP, CFO & Treasurer 555 CALIFORNIA STREET, 50TH FLOOR, SAN FRANCISCO CA 94104
Michael D Weiner officer: EVP, CLO & Secretary 10250 CONSTELLATION BLVD, SUITE 2900, LOS ANGELES CA 90067-6229