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New Oriental Education & Technology Group (New Oriental Education & Technology Group) Beneish M-Score : -3.24 (As of Apr. 25, 2024)


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What is New Oriental Education & Technology Group 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 -3.24 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for New Oriental Education & Technology Group's Beneish M-Score or its related term are showing as below:

EDU' s Beneish M-Score Range Over the Past 10 Years
Min: -3.48   Med: -2.01   Max: 1.3
Current: -3.24

During the past 13 years, the highest Beneish M-Score of New Oriental Education & Technology Group was 1.30. The lowest was -3.48. And the median was -2.01.


New Oriental Education & Technology Group Beneish M-Score Historical Data

The historical data trend for New Oriental Education & Technology Group'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.

New Oriental Education & Technology Group Beneish M-Score Chart

New Oriental Education & Technology Group Annual Data
Trend May14 May15 May16 May17 May18 May19 May20 May21 May22 May23
Beneish M-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only -1.25 -3.14 -2.05 -0.23 -3.25

New Oriental Education & Technology Group Quarterly Data
May19 Aug19 Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21 Nov21 Feb22 May22 Aug22 Nov22 Feb23 May23 Aug23 Nov23 Feb24
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 -2.44 -3.25 -2.77 -3.24 -

Competitive Comparison of New Oriental Education & Technology Group's Beneish M-Score

For the Education & Training Services subindustry, New Oriental Education & Technology Group'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.


New Oriental Education & Technology Group's Beneish M-Score Distribution in the Education Industry

For the Education industry and Consumer Defensive sector, New Oriental Education & Technology Group's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where New Oriental Education & Technology Group's Beneish M-Score falls into.



New Oriental Education & Technology Group 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 New Oriental Education & Technology Group 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 * 0.7048+0.528 * 0.9906+0.404 * 1.3185+0.892 * 1.5172+0.115 * 1
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8483+4.679 * -0.120044-0.327 * 1.1389
=-2.75

* 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 (Feb24) TTM:Last Year (Feb23) TTM:
Total Receivables was $40 Mil.
Revenue was 1207.286 + 869.6 + 1100.021 + 860.571 = $4,037 Mil.
Gross Profit was 562.5 + 447.042 + 658.803 + 468.956 = $2,137 Mil.
Total Current Assets was $5,127 Mil.
Total Assets was $7,190 Mil.
Property, Plant and Equipment(Net PPE) was $1,021 Mil.
Depreciation, Depletion and Amortization(DDA) was $0 Mil.
Selling, General, & Admin. Expense(SGA) was $1,749 Mil.
Total Current Liabilities was $2,628 Mil.
Long-Term Debt & Capital Lease Obligation was $386 Mil.
Net Income was 87.167 + 30.066 + 165.386 + 28.959 = $312 Mil.
Non Operating Income was 18.386 + 36.822 + 41.976 + -89.962 = $7 Mil.
Cash Flow from Operations was 109.436 + 300.586 + 335.786 + 421.609 = $1,167 Mil.
Total Receivables was $37 Mil.
Revenue was 754.153 + 638.214 + 744.822 + 524.023 = $2,661 Mil.
Gross Profit was 384.593 + 302.018 + 432.755 + 276.196 = $1,396 Mil.
Total Current Assets was $4,701 Mil.
Total Assets was $6,164 Mil.
Property, Plant and Equipment(Net PPE) was $786 Mil.
Depreciation, Depletion and Amortization(DDA) was $0 Mil.
Selling, General, & Admin. Expense(SGA) was $1,359 Mil.
Total Current Liabilities was $1,954 Mil.
Long-Term Debt & Capital Lease Obligation was $314 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)
=(40.031 / 4037.478) / (37.439 / 2661.212)
=0.009915 / 0.014068
=0.7048

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)
=(1395.562 / 2661.212) / (2137.301 / 4037.478)
=0.524408 / 0.529365
=0.9906

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 - (5127.095 + 1021.081) / 7189.543) / (1 - (4700.797 + 786.338) / 6164.297)
=0.144845 / 0.109852
=1.3185

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
=4037.478 / 2661.212
=1.5172

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 + 786.338)) / (0 / (0 + 1021.081))
=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)
=(1749.349 / 4037.478) / (1359.219 / 2661.212)
=0.433278 / 0.510752
=0.8483

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)
=((385.744 + 2627.888) / 7189.543) / ((314.486 + 1954.314) / 6164.297)
=0.419169 / 0.368055
=1.1389

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
=(311.578 - 7.222 - 1167.417) / 7189.543
=-0.120044

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.

New Oriental Education & Technology Group has a M-score of -2.75 suggests that the company is unlikely to be a manipulator.


New Oriental Education & Technology Group Beneish M-Score Related Terms

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New Oriental Education & Technology Group (New Oriental Education & Technology Group) Business Description

Address
No. 6 Hai Dian Zhong Street, Haidian District, Beijing, CHN, 100080
New Oriental is a leading private education provider in China. K-9 academic after-school tutoring used to account for 50%-60% of New Oriental's revenue before the regulatory crackdown in 2021. After terminating its K-9 academic after-school tutoring business, New Oriental has identified a few new initiatives such as nonacademic tutoring and intelligent learning systems and devices. The remaining businesses include high school academic after-school tutoring and overseas-related test preparation and consulting business. It also owns 55.7% of East Buy (HKG: 01797), a market leader in livestreaming e-commerce.