Equitable Financial (Equitable Financial) Beneish M-Score : -2.43 (As of Apr. 29, 2024)

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What is Equitable Financial Beneish M-Score?

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

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 -2.43 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

EQFN' s Beneish M-Score Range Over the Past 10 Years
Min: -3.96 Med: -2.37 Max: -2.11
Current: -2.43

During the past 12 years, the highest Beneish M-Score of Equitable Financial was -2.11. The lowest was -3.96. And the median was -2.37.

Equitable Financial 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 Equitable Financial 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 * 1.3954

0.528 * 1

0.404 * 1.0168

0.892 * 0.9425

0.115 * 0.9758

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0944

4.679 * -0.00486

0.327 * 1.6919

-2.43

* 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 (Jun23) TTM:

Last Year (Jun22) TTM:

Total Receivables was $3.04 Mil.
Revenue was $19.90 Mil.
Gross Profit was $19.90 Mil.
Total Current Assets was $41.93 Mil.
Total Assets was $481.05 Mil.
Property, Plant and Equipment(Net PPE) was $8.16 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.89 Mil.
Selling, General, & Admin. Expense(SGA) was $9.03 Mil.
Total Current Liabilities was $3.54 Mil.
Long-Term Debt & Capital Lease Obligation was $15.00 Mil.
Net Income was $3.59 Mil.
Gross Profit was $0.00 Mil.
Cash Flow from Operations was $5.93 Mil.

Total Receivables was $2.31 Mil.
Revenue was $21.12 Mil.
Gross Profit was $21.12 Mil.
Total Current Assets was $45.36 Mil.
Total Assets was $454.83 Mil.
Property, Plant and Equipment(Net PPE) was $8.73 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.92 Mil.
Selling, General, & Admin. Expense(SGA) was $8.76 Mil.
Total Current Liabilities was $4.36 Mil.
Long-Term Debt & Capital Lease Obligation was $6.00 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)
	=	(3.038 / 19.901)	/	(2.31 / 21.116)
	=	0.152656	/	0.109396
	=	1.3954

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)
	=	(21.116 / 21.116)	/	(19.901 / 19.901)
	=	1	/	1
	=	1

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 - (41.925 + 8.162) / 481.049)	/	(1 - (45.355 + 8.727) / 454.828)
	=	0.89588	/	0.881094
	=	1.0168

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
	=	19.901	/	21.116
	=	0.9425

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))
	=	(0.923 / (0.923 + 8.727))	/	(0.887 / (0.887 + 8.162))
	=	0.095648	/	0.098022
	=	0.9758

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)
	=	(9.033 / 19.901)	/	(8.758 / 21.116)
	=	0.453897	/	0.414757
	=	1.0944

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)
	=	((15 + 3.542) / 481.049)	/	((6 + 4.362) / 454.828)
	=	0.038545	/	0.022782
	=	1.6919

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
	=	(3.588 - 0	-	5.926)	/	481.049
	=	-0.00486

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.

Equitable Financial has a M-score of -2.43 suggests that the company is unlikely to be a manipulator.

Equitable Financial Beneish M-Score Related Terms

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Equitable Financial (Equitable Financial) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » Equitable Financial Corp (OTCPK:EQFN) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

N/A

Address

113 North Locust Street, PO Box 160, Grand Island, NE, USA, 68801

Website

https://www.equitableonline.com

Equitable Financial Corp is a holding company. The bank is engaged in the business of attracting deposits from the public and using those funds to originate commercial loans, agricultural loans, one- to four-family residential real estate loans and Other, these all activities are conducted through its main offices which are Located in Grand Island, North Platte, Omaha and Elkhorn, Nebraska.. The Bank's primary services include accepting deposits, making loans, and investing in securities. It also provides Advisory services and wealth management.

Executives

William B Westering	director	113 N LOCUST ST, GRAND ISLAND NE 68801
Wassinger Benedict P Jr	director	113-115 NORTH LOCUST STREET, GRAND ISLAND NE 68801
Thomas E Gdowski	director, officer: President and CEO	113-115 NORTH LOCUST STREET, GRAND ISLAND NE 68801
Douglas J Nodgaard	officer: Community Bank President	10855 W DODGE RD, STE 110, OMAHA NE 68154
Jack E Rasmussen	director	113-115 NORTH LOCUST STREET, GRAND ISLAND NE 68801
Douglas J Redman	director	113-115 NORTH LOCUST STREET, GRAND ISLAND NE 68801
Pamela L Price	director	113-115 NORTH LOCUST STREET, GRAND ISLAND NE 68801
Gary L Hedman	director	113-115 NORTH LOCUST STREET, GRAND ISLAND NE 68801
Vincent J Dugan	director	113-115 NORTH LOCUST STREET, GRAND ISLAND NE 68801
Darcy M Ray	officer: VP Finance and Controller	113 N LOCUST ST, GRAND ISLAND NE 68801
David Lee Richardson	director, officer: Community Bank President	113 N LOCUST ST, GRAND ISLAND NE 68801
Levi D Fisher	director, officer: Community Bank President	920 S JEFFERS ST, NORTH PLATTE NE 69101