Hovnanian Enterprises Beneish M-Score Historical Data
The historical data trend for Hovnanian Enterprises'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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Hovnanian Enterprises Annual Data
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Trend |
Oct14 |
Oct15 |
Oct16 |
Oct17 |
Oct18 |
Oct19 |
Oct20 |
Oct21 |
Oct22 |
Oct23 |
| Beneish M-Score |
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-1.64 |
-3.42 |
-1.11 |
-2.37 |
-3.20 |
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Hovnanian Enterprises Quarterly Data
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Apr19 |
Jul19 |
Oct19 |
Jan20 |
Apr20 |
Jul20 |
Oct20 |
Jan21 |
Apr21 |
Jul21 |
Oct21 |
Jan22 |
Apr22 |
Jul22 |
Oct22 |
Jan23 |
Apr23 |
Jul23 |
Oct23 |
Jan24 |
| Beneish M-Score |
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-2.45 |
-2.73 |
-3.29 |
-3.20 |
-3.18 |
Competitive Comparison
For the Residential Construction subindustry, Hovnanian Enterprises'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.
Hovnanian Enterprises Beneish M-Score Distribution
For the Homebuilding & Construction industry and Consumer Cyclical sector, Hovnanian Enterprises's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where Hovnanian Enterprises's Beneish M-Score falls into.
Hovnanian Enterprises 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 Hovnanian Enterprises 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 * 0.6527 | + | 0.528 * 1.0474 | + | 0.404 * 1.0477 | + | 0.892 * 0.987 | + | 0.115 * 0.8706 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 1.0815 | + | 4.679 * -0.089774 | - | 0.327 * 0.8918 |
| = | -3.18 |
* 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 (Jan24) TTM: | Last Year (Jan23) TTM: |
Total Receivables was $24 Mil.
Revenue was 594.196 + 887.032 + 649.957 + 703.661 = $2,835 Mil.
Gross Profit was 113.312 + 212.996 + 136.042 + 131.325 = $594 Mil.
Total Current Assets was $1,679 Mil.
Total Assets was $2,340 Mil.
Property, Plant and Equipment(Net PPE) was $37 Mil.
Depreciation, Depletion and Amortization(DDA) was $9 Mil.
Selling, General, & Admin. Expense(SGA) was $317 Mil.
Total Current Liabilities was $456 Mil.
Long-Term Debt & Capital Lease Obligation was $1,034 Mil.
Net Income was 23.904 + 97.265 + 55.764 + 34.146 = $211 Mil.
Non Operating Income was 15.772 + 0.131 + 22.931 + 4.834 = $44 Mil.
Cash Flow from Operations was -89.004 + 143.676 + 225.632 + 97.213 = $378 Mil.
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Total Receivables was $38 Mil.
Revenue was 515.366 + 886.788 + 767.593 + 702.537 = $2,872 Mil.
Gross Profit was 99.774 + 179.86 + 184.601 + 165.82 = $630 Mil.
Total Current Assets was $1,788 Mil.
Total Assets was $2,435 Mil.
Property, Plant and Equipment(Net PPE) was $28 Mil.
Depreciation, Depletion and Amortization(DDA) was $6 Mil.
Selling, General, & Admin. Expense(SGA) was $297 Mil.
Total Current Liabilities was $460 Mil.
Long-Term Debt & Capital Lease Obligation was $1,279 Mil.
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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) |
| = | (24.208 / 2834.846) | / | (37.577 / 2872.284) |
| = | 0.008539 | / | 0.013083 |
| | = | 0.6527 |
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) |
| = | (630.055 / 2872.284) | / | (593.675 / 2834.846) |
| = | 0.219357 | / | 0.209421 |
| | = | 1.0474 |
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 - (1679.253 + 37.441) / 2340.378) | / | (1 - (1787.698 + 28.089) / 2435.185) |
| = | 0.266489 | / | 0.254354 |
| | = | 1.0477 |
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 |
| = | 2834.846 | / | 2872.284 |
| | = | 0.987 |
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)) |
| = | (5.692 / (5.692 + 28.089)) | / | (8.986 / (8.986 + 37.441)) |
| = | 0.168497 | / | 0.193551 |
| | = | 0.8706 |
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) |
| = | (317.436 / 2834.846) | / | (297.381 / 2872.284) |
| = | 0.111976 | / | 0.103535 |
| | = | 1.0815 |
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) |
| = | ((1034.17 + 456.06) / 2340.378) | / | ((1279.147 + 459.584) / 2435.185) |
| = | 0.636748 | / | 0.714004 |
| | = | 0.8918 |
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 |
| = | (211.079 - 43.668 | - | 377.517) | / | 2340.378 |
| | = | -0.089774 |
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.
Hovnanian Enterprises has a M-score of -3.18 suggests that the company is unlikely to be a manipulator.
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