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FSUGY (Fortescue) Beneish M-Score : -2.68 (As of Dec. 13, 2024)


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What is Fortescue 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 -2.68 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

FSUGY' s Beneish M-Score Range Over the Past 10 Years
Min: -3.6   Med: -2.67   Max: 5.73
Current: -2.68

During the past 13 years, the highest Beneish M-Score of Fortescue was 5.73. The lowest was -3.60. And the median was -2.67.


Fortescue Beneish M-Score Historical Data

The historical data trend for Fortescue'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.

Fortescue Beneish M-Score Chart

Fortescue Annual Data
Trend Jun15 Jun16 Jun17 Jun18 Jun19 Jun20 Jun21 Jun22 Jun23 Jun24
Beneish M-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only -2.65 -2.48 5.73 -2.51 -2.68

Fortescue Semi-Annual Data
Dec14 Jun15 Dec15 Jun16 Dec16 Jun17 Dec17 Jun18 Dec18 Jun19 Dec19 Jun20 Dec20 Jun21 Dec21 Jun22 Dec22 Jun23 Dec23 Jun24
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 5.73 - -2.51 - -2.68

Competitive Comparison of Fortescue's Beneish M-Score

For the Other Industrial Metals & Mining subindustry, Fortescue'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.


Fortescue's Beneish M-Score Distribution in the Metals & Mining Industry

For the Metals & Mining industry and Basic Materials sector, Fortescue's Beneish M-Score distribution charts can be found below:

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



Fortescue 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 Fortescue 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 * 1.1654+0.528 * 0.9985+0.404 * 0.9825+0.892 * 1.0792+0.115 * 0.8531
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3385+4.679 * -0.077512-0.327 * 0.9721
=-2.69

* 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 (Jun24) TTM:Last Year (Jun23) TTM:
Total Receivables was $654 Mil.
Revenue was $18,109 Mil.
Gross Profit was $11,534 Mil.
Total Current Assets was $7,165 Mil.
Total Assets was $30,060 Mil.
Property, Plant and Equipment(Net PPE) was $21,682 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,144 Mil.
Selling, General, & Admin. Expense(SGA) was $416 Mil.
Total Current Liabilities was $2,686 Mil.
Long-Term Debt & Capital Lease Obligation was $5,208 Mil.
Net Income was $5,683 Mil.
Gross Profit was $94 Mil.
Cash Flow from Operations was $7,919 Mil.
Total Receivables was $520 Mil.
Revenue was $16,780 Mil.
Gross Profit was $10,671 Mil.
Total Current Assets was $6,085 Mil.
Total Assets was $28,218 Mil.
Property, Plant and Equipment(Net PPE) was $20,974 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,744 Mil.
Selling, General, & Admin. Expense(SGA) was $288 Mil.
Total Current Liabilities was $2,467 Mil.
Long-Term Debt & Capital Lease Obligation was $5,156 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)
=(654 / 18109) / (520 / 16780)
=0.036115 / 0.030989
=1.1654

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)
=(10671 / 16780) / (11534 / 18109)
=0.635936 / 0.636921
=0.9985

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 - (7165 + 21682) / 30060) / (1 - (6085 + 20974) / 28218)
=0.040353 / 0.041073
=0.9825

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
=18109 / 16780
=1.0792

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))
=(1744 / (1744 + 20974)) / (2144 / (2144 + 21682))
=0.076767 / 0.089986
=0.8531

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)
=(416 / 18109) / (288 / 16780)
=0.022972 / 0.017163
=1.3385

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)
=((5208 + 2686) / 30060) / ((5156 + 2467) / 28218)
=0.262608 / 0.270147
=0.9721

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
=(5683 - 94 - 7919) / 30060
=-0.077512

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.

Fortescue has a M-score of -2.69 suggests that the company is unlikely to be a manipulator.


Fortescue Beneish M-Score Related Terms

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Fortescue Business Description

Traded in Other Exchanges
Address
87 Adelaide Terrace, Level 2, East Perth, Perth, WA, AUS, 6004
Fortescue is an Australia-based iron ore miner. It has grown from obscurity start of 2008 to become the world's fourth-largest producer. Growth was fueled by debt, now repaid. Expansion from 55 million metric tons in fiscal 2012 to about 190 million metric tons in 2024 means Fortescue supplies around 10% of global seaborne iron ore. Further expansion above 200 million metric tons is likely once its 22 million metric ton Iron Bridge magnetite mine ramps up, likely in 2026 or 2027. However, with longer-term demand likely to decline as China's economy matures, Fortescue's future margins are likely to be below historical averages. More recently, Fortescue diversified into green energy, with ambitions to become a major supplier of green hydrogen and green ammonia. Its efforts are early stage.