Alibaba Group Holding (BUE:BABA) Beneish M-Score

: -2.89 (As of Today)

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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 -2.89 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

BUE:BABA' s Beneish M-Score Range Over the Past 10 Years
Min: -3.16 Med: -2.39 Max: -1.93
Current: -2.89

During the past 13 years, the highest Beneish M-Score of Alibaba Group Holding was -1.93. The lowest was -3.16. And the median was -2.39.

Alibaba Group Holding Beneish M-Score Historical Data

The historical data trend for Alibaba Group Holding'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.

Alibaba Group Holding Annual Data

Trend

Mar14

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

Beneish M-Score

-2.39

-2.21

-2.38

-2.30

-2.96

Alibaba Group Holding Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Beneish M-Score																-2.85	-2.96	-2.90	-2.73	-2.89

Competitive Comparison

For the Internet Retail subindustry, Alibaba Group Holding'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.

Alibaba Group Holding Beneish M-Score Distribution

For the Retail - Cyclical industry and Consumer Cyclical sector, Alibaba Group Holding's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Alibaba Group Holding's Beneish M-Score falls into.

Alibaba Group Holding 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 Alibaba Group Holding 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 * 0.8659

0.528 * 0.9623

0.404 * 0.9352

0.892 * 2.1944

0.115 * 0.6296

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.9943

4.679 * -0.041595

0.327 * 1.0114

-1.82

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was ARS7,721,240 Mil.
Revenue was 13162884.513 + 10779164.307 + 7847270.087 + 5968728.414 = ARS37,758,047 Mil.
Gross Profit was 5264890.899 + 4081974.914 + 3076795.04 + 1988916.768 = ARS14,412,578 Mil.
Total Current Assets was ARS40,813,193 Mil.
Total Assets was ARS92,065,870 Mil.
Property, Plant and Equipment(Net PPE) was ARS9,181,884 Mil.
Depreciation, Depletion and Amortization(DDA) was ARS1,009,358 Mil.
Selling, General, & Admin. Expense(SGA) was ARS6,184,135 Mil.
Total Current Liabilities was ARS22,688,467 Mil.
Long-Term Debt & Capital Lease Obligation was ARS7,056,594 Mil.
Net Income was 735883.449 + 1335323.584 + 1147552.155 + 677831.963 = ARS3,896,591 Mil.
Non Operating Income was -407048.962 + 66701.444 + -22353.171 + 37498.063 = ARS-325,203 Mil.
Cash Flow from Operations was 3271963.811 + 2360732.408 + 1518339.989 + 900211.532 = ARS8,051,248 Mil.

Total Receivables was ARS4,063,379 Mil.
Revenue was 5957842.695 + 4101019.243 + 3694353.202 + 3453248.836 = ARS17,206,464 Mil.
Gross Profit was 2350639.667 + 1503736.088 + 1364082.7 + 1101830.278 = ARS6,320,289 Mil.
Total Current Assets was ARS17,515,417 Mil.
Total Assets was ARS42,614,653 Mil.
Property, Plant and Equipment(Net PPE) was ARS4,275,499 Mil.
Depreciation, Depletion and Amortization(DDA) was ARS284,354 Mil.
Selling, General, & Admin. Expense(SGA) was ARS2,834,162 Mil.
Total Current Liabilities was ARS10,047,770 Mil.
Long-Term Debt & Capital Lease Obligation was ARS3,565,241 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)
	=	(7721240.021 / 37758047.321)	/	(4063378.765 / 17206463.976)
	=	0.204493	/	0.236154
	=	0.8659

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)
	=	(6320288.733 / 17206463.976)	/	(14412577.621 / 37758047.321)
	=	0.367321	/	0.381709
	=	0.9623

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 - (40813193.188 + 9181883.981) / 92065870.144)	/	(1 - (17515416.904 + 4275499.28) / 42614653.236)
	=	0.456964	/	0.488652
	=	0.9352

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
	=	37758047.321	/	17206463.976
	=	2.1944

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))
	=	(284353.923 / (284353.923 + 4275499.28))	/	(1009358.165 / (1009358.165 + 9181883.981))
	=	0.06236	/	0.099042
	=	0.6296

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)
	=	(6184134.772 / 37758047.321)	/	(2834162.387 / 17206463.976)
	=	0.163783	/	0.164715
	=	0.9943

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)
	=	((7056593.933 + 22688467.27) / 92065870.144)	/	((3565240.631 + 10047769.589) / 42614653.236)
	=	0.323085	/	0.319444
	=	1.0114

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
	=	(3896591.151 - -325202.626	-	8051247.74)	/	92065870.144
	=	-0.041595

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.

Alibaba Group Holding has a M-score of -1.82 suggests that the company is unlikely to be a manipulator.

Alibaba Group Holding Beneish M-Score Related Terms

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Alibaba Group Holding (BUE:BABA) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Retail - Cyclical » Alibaba Group Holding Ltd (BUE:BABA) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

BABAF:USA BABA:USA BABA:Mexico 09988:Hong Kong 0HCI:UK AHLAd:UK AHLA:Germany BABA34:Brazil AHLA:Austria

Address

1 Matheson Street, Causeway Bay, 26th Floor, Tower One, Times Square, Hong Kong, HKG

Website

https://www.alibabagroup.com

Alibaba is the world's largest online and mobile commerce company as measured by gross merchandise volume (CNY 8.3 trillion for the fiscal year ended March 2022). It operates China's online marketplaces, including Taobao (consumer-to-consumer) and Tmall (business-to-consumer). Alibaba's China commerce retail division accounted for 67% of revenue in the year ended March 2022. Additional revenue sources include China commerce wholesale (2%), international commerce retail/wholesale (5%/2%), local consumer services (5%), cloud computing (9%), digital media and entertainment platforms (4%), Cainiao logistics services (5%), and innovation initiatives/other (1%).