Wenzhou Kangning Hospital Co (HKSE:02120) Beneish M-Score : -2.67 (As of May. 06, 2024)

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What is Wenzhou Kangning Hospital Co 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 -2.67 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

HKSE:02120' s Beneish M-Score Range Over the Past 10 Years
Min: -2.77 Med: -2.62 Max: -1.94
Current: -2.67

During the past 10 years, the highest Beneish M-Score of Wenzhou Kangning Hospital Co was -1.94. The lowest was -2.77. And the median was -2.62.

Wenzhou Kangning Hospital Co Beneish M-Score Historical Data

The historical data trend for Wenzhou Kangning Hospital Co'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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Wenzhou Kangning Hospital Co Beneish M-Score Chart

Wenzhou Kangning Hospital Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.61

-2.77

-2.63

-2.67

Wenzhou Kangning Hospital Co Semi-Annual Data
	Dec14	Jun15	Dec15	Jun16	Dec16	Jun17	Dec17	Jun18	Dec18	Jun19	Dec19	Jun20	Dec20	Jun21	Dec21	Jun22	Dec22	Jun23	Dec23
Beneish M-Score	Get a 7-Day Free Trial														-2.63	-	-2.67	-	-2.67

Competitive Comparison of Wenzhou Kangning Hospital Co's Beneish M-Score

For the Medical Care Facilities subindustry, Wenzhou Kangning Hospital Co'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.

Wenzhou Kangning Hospital Co's Beneish M-Score Distribution in the Healthcare Providers & Services Industry

For the Healthcare Providers & Services industry and Healthcare sector, Wenzhou Kangning Hospital Co's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Wenzhou Kangning Hospital Co's Beneish M-Score falls into.

Wenzhou Kangning Hospital 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 Wenzhou Kangning Hospital Co 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 * 1.0855

0.528 * 0.9228

0.404 * 0.9843

0.892 * 1.0529

0.115 * 1.0968

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.8728

4.679 * -0.058761

0.327 * 1.0799

-2.67

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was HK$536 Mil.
Revenue was HK$1,746 Mil.
Gross Profit was HK$450 Mil.
Total Current Assets was HK$1,080 Mil.
Total Assets was HK$3,333 Mil.
Property, Plant and Equipment(Net PPE) was HK$1,258 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$124 Mil.
Selling, General, & Admin. Expense(SGA) was HK$75 Mil.
Total Current Liabilities was HK$876 Mil.
Long-Term Debt & Capital Lease Obligation was HK$789 Mil.
Net Income was HK$94 Mil.
Gross Profit was HK$0 Mil.
Cash Flow from Operations was HK$290 Mil.

Total Receivables was HK$469 Mil.
Revenue was HK$1,658 Mil.
Gross Profit was HK$394 Mil.
Total Current Assets was HK$886 Mil.
Total Assets was HK$2,946 Mil.
Property, Plant and Equipment(Net PPE) was HK$1,166 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$128 Mil.
Selling, General, & Admin. Expense(SGA) was HK$82 Mil.
Total Current Liabilities was HK$734 Mil.
Long-Term Debt & Capital Lease Obligation was HK$628 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)
	=	(536.112 / 1745.962)	/	(469.056 / 1658.213)
	=	0.307058	/	0.282868
	=	1.0855

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)
	=	(394.123 / 1658.213)	/	(449.692 / 1745.962)
	=	0.237679	/	0.257561
	=	0.9228

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 - (1080.269 + 1257.856) / 3333.496)	/	(1 - (885.614 + 1166.439) / 2945.656)
	=	0.298597	/	0.303363
	=	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
	=	1745.962	/	1658.213
	=	1.0529

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))
	=	(127.54 / (127.54 + 1166.439))	/	(124.199 / (124.199 + 1257.856))
	=	0.098564	/	0.089865
	=	1.0968

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)
	=	(74.984 / 1745.962)	/	(81.593 / 1658.213)
	=	0.042947	/	0.049205
	=	0.8728

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)
	=	((788.57 + 876.259) / 3333.496)	/	((628.094 + 734.18) / 2945.656)
	=	0.499424	/	0.462469
	=	1.0799

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
	=	(94.008 - 0	-	289.887)	/	3333.496
	=	-0.058761

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.

Wenzhou Kangning Hospital Co has a M-score of -2.67 suggests that the company is unlikely to be a manipulator.

Wenzhou Kangning Hospital Co Beneish M-Score Related Terms

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Wenzhou Kangning Hospital Co (HKSE:02120) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Healthcare Providers & Services » Wenzhou Kangning Hospital Co Ltd (HKSE:02120) » Definitions » Beneish M-Score

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Traded in Other Exchanges

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Address

Shengjin Road, Huanglong Residential District, Zhejiang, Wenzhou, CHN

Website

http://www.knhosp.cn

Wenzhou Kangning Hospital Co Ltd is engaged in operating and managing a network of healthcare facilities that focus on providing psychiatric specialty care and elderly rehabilitation service across various regions in China. The company operates only in one reporting segment. The Group generates revenue mainly through the following three ways- revenue from operating its owned hospitals; revenue from other healthcare related business; and other revenue not related to healthcare business.

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