POSCO Holdings (FRA:PKX) Beneish M-Score : -2.73 (As of Dec. 14, 2024)

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What is POSCO Holdings 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 -2.73 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

FRA:PKX' s Beneish M-Score Range Over the Past 10 Years
Min: -2.99 Med: -2.66 Max: -2.02
Current: -2.73

During the past 13 years, the highest Beneish M-Score of POSCO Holdings was -2.02. The lowest was -2.99. And the median was -2.66.

POSCO Holdings Beneish M-Score Historical Data

The historical data trend for POSCO Holdings'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.

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POSCO Holdings Beneish M-Score Chart

POSCO Holdings Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.51

-2.90

-2.48

-2.12

-2.57

POSCO Holdings 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															-2.38	-2.57	-2.77	-2.82	-2.73

Competitive Comparison of POSCO Holdings's Beneish M-Score

For the Steel subindustry, POSCO Holdings'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.

POSCO Holdings's Beneish M-Score Distribution in the Steel Industry

For the Steel industry and Basic Materials sector, POSCO Holdings's Beneish M-Score distribution charts can be found below:

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

POSCO Holdings 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 POSCO Holdings 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 * 1.0441

0.528 * 0.9911

0.404 * 0.9843

0.892 * 0.9048

0.115 * 1.084

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.1099

4.679 * -0.048388

0.327 * 0.9755

-2.76

This Year (Sep24) TTM:

Last Year (Sep23) TTM:

Total Receivables was €8,868 Mil.
Revenue was 12405.179 + 12469.063 + 12471.355 + 13071.361 = €50,417 Mil.
Gross Profit was 1020.038 + 1007.106 + 918.036 + 772.498 = €3,718 Mil.
Total Current Assets was €29,926 Mil.
Total Assets was €69,267 Mil.
Property, Plant and Equipment(Net PPE) was €26,157 Mil.
Depreciation, Depletion and Amortization(DDA) was €2,714 Mil.
Selling, General, & Admin. Expense(SGA) was €1,658 Mil.
Total Current Liabilities was €15,318 Mil.
Long-Term Debt & Capital Lease Obligation was €10,074 Mil.
Net Income was 306.487 + 356.99 + 373.558 + -144.926 = €892 Mil.
Non Operating Income was 33.297 + 24.932 + 125.727 + -250.395 = €-66 Mil.
Cash Flow from Operations was 906.077 + 1879.822 + 196.993 + 1327.347 = €4,310 Mil.

Total Receivables was €9,387 Mil.
Revenue was 13315.699 + 14316.443 + 13860.273 + 14231.162 = €55,724 Mil.
Gross Profit was 1342.081 + 1447.088 + 982.215 + 301.067 = €4,072 Mil.
Total Current Assets was €34,137 Mil.
Total Assets was €72,314 Mil.
Property, Plant and Equipment(Net PPE) was €24,195 Mil.
Depreciation, Depletion and Amortization(DDA) was €2,745 Mil.
Selling, General, & Admin. Expense(SGA) was €1,651 Mil.
Total Current Liabilities was €15,492 Mil.
Long-Term Debt & Capital Lease Obligation was €11,680 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)
	=	(8867.643 / 50416.958)	/	(9387.379 / 55723.577)
	=	0.175886	/	0.168463
	=	1.0441

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)
	=	(4072.451 / 55723.577)	/	(3717.678 / 50416.958)
	=	0.073083	/	0.073739
	=	0.9911

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 - (29926.407 + 26157.183) / 69266.995)	/	(1 - (34136.862 + 24194.614) / 72314.053)
	=	0.190327	/	0.193359
	=	0.9843

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
	=	50416.958	/	55723.577
	=	0.9048

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))
	=	(2744.706 / (2744.706 + 24194.614))	/	(2713.628 / (2713.628 + 26157.183))
	=	0.101885	/	0.093992
	=	1.084

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)
	=	(1657.651 / 50416.958)	/	(1650.718 / 55723.577)
	=	0.032879	/	0.029623
	=	1.1099

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)
	=	((10073.724 + 15317.621) / 69266.995)	/	((11680.475 + 15492.458) / 72314.053)
	=	0.366572	/	0.375763
	=	0.9755

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
	=	(892.109 - -66.439	-	4310.239)	/	69266.995
	=	-0.048388

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.

POSCO Holdings has a M-score of -2.76 suggests that the company is unlikely to be a manipulator.

POSCO Holdings Beneish M-Score Related Terms

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POSCO Holdings Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Steel » POSCO Holdings Inc (FRA:PKX) » Definitions » Beneish M-Score

Traded in Other Exchanges

PKX:USA 005490:Korea PKX:Germany P1KX34:Brazil

Address

POSCO Center, 440 Teheran-ro, Gangnam-gu, Seoul, KOR, 06194

Website

https://www.posco.co.kr

POSCO Holdings Inc is a holding company and operates through its subsidiaries. The company operates across four distinct segments. The first segment is the Steel Segment, which includes the production and sale of steel products. The second segment is the Green Infrastructure Business, which is further divided into three operations. The Trading Segment comprises trading and natural resource development activities. The Construction Segment involves the planning, designing, and construction of industrial plants, civil engineering projects, and buildings. The Energy and Other Segments include power generation, as well as information technology and operational technology services. The third segment is the Green Materials and Energy Segment, and the fourth segment is the Others Segment.