China Merchants Bank Co (FRA:M4B) Beneish M-Score: -2.63 (As of Jun. 25, 2026)


FRA:M4B China Merchants Bank Co Ltd FRA:M4B
63 GF Score
Price €5.09
GF Value €5.44
Valuation Fairly Valued
! 2 Warning Signs
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What is China Merchants Bank Co Beneish M-Score?

China Merchants Bank Co FRA:M4B -2.00% 63 Beneish M-Score is -2.63 as of Jun. 25, 2026. GuruFocus rates FRA:M4B with a GF Score™ of 63/100 and a GF Value™ of €5.44 (Fairly Valued). The stock has 2 warning signs investors should review. Among 1,396 Banks companies, China Merchants Bank Co ranks better than 82.81% on this metric.

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 -2.63 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for China Merchants Bank Co's Beneish M-Score or its related term are showing as below:

FRA:M4B' s Beneish M-Score Range Over the Past 10 Years
Min: -4.07   Med: -2.47   Max: 9.97
Current: -2.63

During the past 13 years, the highest Beneish M-Score of China Merchants Bank Co was 9.97. The lowest was -4.07. And the median was -2.47.

FRA:M4B
63GF Score
China Merchants Bank Co Ltd FRA:M4B
Beneish M-Score is just one metric. See GF Score™, valuation, warning signs, and more.
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China Merchants Bank Co 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 China Merchants Bank Co 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+0.528 * 1+0.404 * 1.0009+0.892 * 0.9562+0.115 * 1
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.811+4.679 * -0.02397-0.327 * 0.9231
=-2.57

* 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 (Mar26) TTM:Last Year (Mar25) TTM:
Total Receivables was €0 Mil.
Revenue was 10911.493 + 9777.616 + 9741.876 + 10208.537 = €40,640 Mil.
Gross Profit was 10911.493 + 9777.616 + 9741.876 + 10208.537 = €40,640 Mil.
Total Current Assets was €0 Mil.
Total Assets was €1,692,434 Mil.
Property, Plant and Equipment(Net PPE) was €17,325 Mil.
Depreciation, Depletion and Amortization(DDA) was €0 Mil.
Selling, General, & Admin. Expense(SGA) was €-406 Mil.
Total Current Liabilities was €0 Mil.
Long-Term Debt & Capital Lease Obligation was €54,654 Mil.
Net Income was 4750.654 + 4414.653 + 4645.664 + 4545.338 = €18,356 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = €0 Mil.
Cash Flow from Operations was 15794.806 + 33383.383 + 4984.263 + 4761.593 = €58,924 Mil.
 Total Receivables was €0 Mil.
Revenue was 10686.504 + 10775.116 + 10156.496 + 10881.851 = €42,500 Mil.
Gross Profit was 10686.504 + 10775.116 + 10156.496 + 10881.851 = €42,500 Mil.
Total Current Assets was €0 Mil.
Total Assets was €1,598,783 Mil.
Property, Plant and Equipment(Net PPE) was €17,715 Mil.
Depreciation, Depletion and Amortization(DDA) was €0 Mil.
Selling, General, & Admin. Expense(SGA) was €-523 Mil.
Total Current Liabilities was €0 Mil.
Long-Term Debt & Capital Lease Obligation was €55,929 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)
=(0 / 40639.522) / (0 / 42499.967)
=0 / 0
=1

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)
=(42499.967 / 42499.967) / (40639.522 / 40639.522)
=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 - (0 + 17325.478) / 1692433.791) / (1 - (0 + 17714.631) / 1598783)
=0.989763 / 0.98892
=1.0009

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
=40639.522 / 42499.967
=0.9562

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 + 17714.631)) / (0 / (0 + 17325.478))
=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)
=(-405.876 / 40639.522) / (-523.392 / 42499.967)
=-0.009987 / -0.012315
=0.811

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)
=((54654.229 + 0) / 1692433.791) / ((55928.859 + 0) / 1598783)
=0.032293 / 0.034982
=0.9231

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
=(18356.309 - 0 - 58924.045) / 1692433.791
=-0.02397

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.

China Merchants Bank Co has a M-score of -2.57 suggests that the company is unlikely to be a manipulator.

Frequently Asked Questions Learn more about Beneish M-Score →
What does a Beneish M-Score of -2.63 mean?
China Merchants Bank Co (FRA:M4B) has a Beneish M-Score of -2.63 as of Jun. 25, 2026. The Beneish M-score measures the likelihood of earnings manipulation. View historical data on China Merchants Bank Co and its competitors. According to the industry distribution chart, China Merchants Bank Co ranks #240 out of 1396 companies in the Banks industry, placing it in the top 17.2%.
Is China Merchants Bank Co's Beneish M-Score too high?
China Merchants Bank Co's current Beneish M-Score is -2.63. Based on the distribution chart, China Merchants Bank Co ranks #240 out of 1396 companies in the Banks industry, which is in the top quartile — a strong position relative to peers. Overall, China Merchants Bank Co has a GF Score™ of 63/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does China Merchants Bank Co's Beneish M-Score compare to competitors?
According to the Banks industry distribution chart, China Merchants Bank Co ranks #240 out of 1396 companies for Beneish M-Score. This places China Merchants Bank Co in the top 17% of its industry — outperforming the majority of peers. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Beneish M-Score for a Banks company?
A good Beneish M-Score depends on the Banks industry context. However, Beneish M-Score should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Beneish M-Score mean?
A high Beneish M-Score can signal that a stock is expensive relative to its fundamentals. The Beneish M-score measures the likelihood of earnings manipulation. View historical data on China Merchants Bank Co and its competitors. China Merchants Bank Co's current Beneish M-Score is -2.63. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is China Merchants Bank Co stock overvalued right now?
Based on GuruFocus' analysis, China Merchants Bank Co (FRA:M4B) is currently considered Fairly Valued. The stock's GF Value™ is €5.44, compared to a current price of €5.09 — trading 6.5% below its estimated fair value. The current Beneish M-Score is -2.63. China Merchants Bank Co's overall GF Score™ is 63/100 with 2 warning signs to review. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Beneish M-Score calculated?
Beneish M-Score is calculated from a company's financial statements. For China Merchants Bank Co (FRA:M4B), the current Beneish M-Score is -2.63 as of Jun. 25, 2026. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.

Is China Merchants Bank Co (FRA:M4B) Overvalued in 2026?

Based on GuruFocus' analysis, China Merchants Bank Co stock appears to be undervalued. The current stock price of €5.09 is trading 6.5% below its estimated GF Value™ of €5.44. GuruFocus considers China Merchants Bank Co to be Fairly Valued.

Key valuation signals for FRA:M4B:

  • Beneish M-Score: -2.63
  • GF Value™: €5.44 vs. price of €5.09 (6.5% below fair value)
  • GF Score™: 63/100 with 2 warning signs

No single metric tells the full story. See the FRA:M4B stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.

China Merchants Bank Co Business Description

Address No. 7088, Shennan Boulevard, 26th Floor, China Merchants Bank Building, Futian District, Guangdong Province, Shenzhen, CHN, 518040
China Merchants Bank was founded in 1987 and is headquartered in Shenzhen. The bank is China's seventh-largest listed bank by assets, with the largest distribution network among China's joint-stock banks. CMB's network has been expanding rapidly. Its outlets are located mainly in China's more developed areas, including the Pearl River and Yangtze River deltas. The firm has 18% and 82% of its shares listed on the Hong Kong and Shanghai exchanges, respectively. It has no foreign strategic investors. China Merchants Group is its largest shareholder, with a 30% stake. Retail banking, corporate banking, and wholesale banking accounted for 49%, 51%, and 0% of total profit before tax, respectively, and 40%, 58%, and 2% of total revenue in 2024.
63GF Score

Get the complete analysis for FRA:M4B

Beneish M-Score is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.

€5.09
Price
€5.44
GF Value