Cerence (MEX:CRNC) Beneish M-Score : -3.17 (As of Mar. 27, 2025)

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What is Cerence 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 -3.17 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

MEX:CRNC' s Beneish M-Score Range Over the Past 10 Years
Min: -3.5 Med: -2.66 Max: -2.02
Current: -3.17

During the past 9 years, the highest Beneish M-Score of Cerence was -2.02. The lowest was -3.50. And the median was -2.66.

Cerence Beneish M-Score Historical Data

The historical data trend for Cerence'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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Cerence Beneish M-Score Chart

Cerence Annual Data

Trend

Sep16

Sep17

Sep18

Sep19

Sep20

Sep21

Sep22

Sep23

Sep24

Beneish M-Score

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-3.50

-2.64

-2.77

-2.31

-2.68

Cerence Quarterly Data
	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24	Dec24
Beneish M-Score	Get a 7-Day Free Trial															-2.64	-2.56	-2.44	-2.68	-3.17

Competitive Comparison of Cerence's Beneish M-Score

For the Software - Application subindustry, Cerence'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.

Cerence's Beneish M-Score Distribution in the Software Industry

For the Software industry and Technology sector, Cerence's Beneish M-Score distribution charts can be found below:

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

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Cerence 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 Cerence 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 * 1.3233

0.528 * 1.0741

0.404 * 0.7745

0.892 * 0.7541

0.115 * 1.3245

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.2824

4.679 * -0.046307

0.327 * 1.8099

-2.95

This Year (Dec24) TTM:

Last Year (Dec23) TTM:

Total Receivables was MXN994 Mil.
Revenue was 1061.472 + 1079.127 + 1292.282 + 1125.641 = MXN4,559 Mil.
Gross Profit was 689.74 + 687.093 + 923.956 + 779.078 = MXN3,080 Mil.
Total Current Assets was MXN4,173 Mil.
Total Assets was MXN12,879 Mil.
Property, Plant and Equipment(Net PPE) was MXN887 Mil.
Depreciation, Depletion and Amortization(DDA) was MXN195 Mil.
Selling, General, & Admin. Expense(SGA) was MXN1,365 Mil.
Total Current Liabilities was MXN3,170 Mil.
Long-Term Debt & Capital Lease Obligation was MXN4,302 Mil.
Net Income was -506.543 + -401.997 + -5744.14 + -4613.361 = MXN-11,266 Mil.
Non Operating Income was -225.033 + -193.516 + -6557.498 + -4259.794 = MXN-11,236 Mil.
Cash Flow from Operations was 192.999 + 120.406 + 235.45 + 17.326 = MXN566 Mil.

Total Receivables was MXN996 Mil.
Revenue was 2348.133 + 1406.82 + 1057.093 + 1232.784 = MXN6,045 Mil.
Gross Profit was 1901.116 + 1005.697 + 698.134 + 781.906 = MXN4,387 Mil.
Total Current Assets was MXN3,876 Mil.
Total Assets was MXN21,471 Mil.
Property, Plant and Equipment(Net PPE) was MXN763 Mil.
Depreciation, Depletion and Amortization(DDA) was MXN240 Mil.
Selling, General, & Admin. Expense(SGA) was MXN1,412 Mil.
Total Current Liabilities was MXN2,037 Mil.
Long-Term Debt & Capital Lease Obligation was MXN4,846 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)
	=	(994.212 / 4558.522)	/	(996.27 / 6044.83)
	=	0.2181	/	0.164814
	=	1.3233

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)
	=	(4386.853 / 6044.83)	/	(3079.867 / 4558.522)
	=	0.72572	/	0.675628
	=	1.0741

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 - (4172.642 + 886.93) / 12878.979)	/	(1 - (3876.256 + 763.366) / 21470.862)
	=	0.607145	/	0.783911
	=	0.7745

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
	=	4558.522	/	6044.83
	=	0.7541

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))
	=	(239.912 / (239.912 + 763.366))	/	(195.413 / (195.413 + 886.93))
	=	0.239128	/	0.180546
	=	1.3245

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)
	=	(1365.301 / 4558.522)	/	(1411.812 / 6044.83)
	=	0.299505	/	0.233557
	=	1.2824

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)
	=	((4302.093 + 3169.733) / 12878.979)	/	((4845.893 + 2036.553) / 21470.862)
	=	0.580157	/	0.320548
	=	1.8099

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
	=	(-11266.041 - -11235.841	-	566.181)	/	12878.979
	=	-0.046307

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.

Cerence has a M-score of -2.95 suggests that the company is unlikely to be a manipulator.

Cerence Beneish M-Score Related Terms

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Cerence Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » Cerence Inc (MEX:CRNC) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

CRNC:USA 0S6:Germany

Address

25 Mall Road, Suite 416, Burlington, MA, USA, 01803

Website

https://www.cerence.com

Cerence Inc is a United States-based software company. It is involved in developing mobility-based solutions for drivers and their cars. The customers include all automobile original equipment manufacturers, or OEMs, or their tier 1 suppliers. The company's revenue is generated by selling software licenses and cloud-connected services. Geographically, it derives a majority of its revenue from the United States and also has a presence in Other Americas; Germany; Other Europe, the Middle East, Africa; Japan, and Other Asia-Pacific.