Kuwait Real Estate Co (KUW:KRE) Beneish M-Score : -2.96 (As of Jun. 23, 2024)

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What is Kuwait Real Estate 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 -2.96 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

KUW:KRE' s Beneish M-Score Range Over the Past 10 Years
Min: -5.45 Med: -2.2 Max: -1.19
Current: -2.96

During the past 13 years, the highest Beneish M-Score of Kuwait Real Estate Co was -1.19. The lowest was -5.45. And the median was -2.20.

Kuwait Real Estate Co Beneish M-Score Historical Data

The historical data trend for Kuwait Real Estate 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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Kuwait Real Estate Co Beneish M-Score Chart

Kuwait Real Estate Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-1.83

-2.28

-2.84

-1.36

Kuwait Real Estate Co Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
Beneish M-Score	Get a 7-Day Free Trial															-2.28	-1.64	-1.19	-1.36	-2.96

Competitive Comparison of Kuwait Real Estate Co's Beneish M-Score

For the Real Estate Services subindustry, Kuwait Real Estate 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.

Kuwait Real Estate Co's Beneish M-Score Distribution in the Real Estate Industry

For the Real Estate industry and Real Estate sector, Kuwait Real Estate Co's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Kuwait Real Estate Co's Beneish M-Score falls into.

Kuwait Real Estate 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 Kuwait Real Estate 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 * 0.4186

0.528 * 1.0188

0.404 * 1.0211

0.892 * 1.0684

0.115 * 0.4521

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.1786

4.679 * 0.010311

0.327 * 0.9357

-2.96

This Year (Mar24) TTM:

Last Year (Mar23) TTM:

Total Receivables was KWD11.28 Mil.
Revenue was 8.231 + 7.431 + 6.467 + 7.395 = KWD29.52 Mil.
Gross Profit was 5.244 + 5.486 + 4.903 + 5.407 = KWD21.04 Mil.
Total Current Assets was KWD99.49 Mil.
Total Assets was KWD416.26 Mil.
Property, Plant and Equipment(Net PPE) was KWD3.42 Mil.
Depreciation, Depletion and Amortization(DDA) was KWD0.21 Mil.
Selling, General, & Admin. Expense(SGA) was KWD3.84 Mil.
Total Current Liabilities was KWD52.00 Mil.
Long-Term Debt & Capital Lease Obligation was KWD193.48 Mil.
Net Income was 5.019 + 1.38 + 2.289 + 2.949 = KWD11.64 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = KWD0.00 Mil.
Cash Flow from Operations was 7.222 + 6.444 + -2.587 + -3.734 = KWD7.35 Mil.

Total Receivables was KWD25.22 Mil.
Revenue was 7.359 + 7.501 + 6.211 + 6.563 = KWD27.63 Mil.
Gross Profit was 5.786 + 4.4 + 4.754 + 5.123 = KWD20.06 Mil.
Total Current Assets was KWD94.40 Mil.
Total Assets was KWD367.86 Mil.
Property, Plant and Equipment(Net PPE) was KWD2.27 Mil.
Depreciation, Depletion and Amortization(DDA) was KWD0.06 Mil.
Selling, General, & Admin. Expense(SGA) was KWD3.05 Mil.
Total Current Liabilities was KWD44.22 Mil.
Long-Term Debt & Capital Lease Obligation was KWD187.62 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)
	=	(11.278 / 29.524)	/	(25.216 / 27.634)
	=	0.381994	/	0.912499
	=	0.4186

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)
	=	(20.063 / 27.634)	/	(21.04 / 29.524)
	=	0.726026	/	0.712641
	=	1.0188

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 - (99.494 + 3.417) / 416.264)	/	(1 - (94.398 + 2.274) / 367.864)
	=	0.752775	/	0.737207
	=	1.0211

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
	=	29.524	/	27.634
	=	1.0684

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))
	=	(0.06 / (0.06 + 2.274))	/	(0.206 / (0.206 + 3.417))
	=	0.025707	/	0.056859
	=	0.4521

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)
	=	(3.838 / 29.524)	/	(3.048 / 27.634)
	=	0.129996	/	0.110299
	=	1.1786

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)
	=	((193.475 + 51.997) / 416.264)	/	((187.62 + 44.221) / 367.864)
	=	0.589703	/	0.630236
	=	0.9357

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
	=	(11.637 - 0	-	7.345)	/	416.264
	=	0.010311

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.

Kuwait Real Estate Co has a M-score of -2.96 suggests that the company is unlikely to be a manipulator.

Kuwait Real Estate Co Beneish M-Score Related Terms

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Kuwait Real Estate Co (KUW:KRE) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » Real Estate » Kuwait Real Estate Co (KUW:KRE) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

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Address

Darwazat Abdul Razak Street, P.O Box 1257, 8th Floor, Block B, Souk Al Kuwait Building, Safat, Kuwait City, KWT, 13013

Website

https://www.aqarat.com.kw

Kuwait Real Estate Co is a Kuwait-based shareholding company that operates in the real estate sector. It is engaged in dealing with a range of real estate activities, including the sale, purchase, renting out, and leasing of lands and real estate properties, erecting buildings, prepare and implementing studies of private and public real estate projects. It has two operating segments, including real estate and investment. The real estate segment contributes to the majority of the revenue. Its geographical segments are Kuwait; Other Middle Eastern Countries; the United States, Europe, and other countries.