Gildan Activewear (Gildan Activewear) Beneish M-Score

: -1.94 (As of Today)

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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 -1.94 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

GIL' s Beneish M-Score Range Over the Past 10 Years
Min: -3.21 Med: -2.45 Max: -1.94
Current: -1.94

During the past 13 years, the highest Beneish M-Score of Gildan Activewear was -1.94. The lowest was -3.21. And the median was -2.45.

Gildan Activewear Beneish M-Score Historical Data

The historical data trend for Gildan Activewear'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.

Gildan Activewear Annual Data

Trend

Sep14

Sep15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

-2.56

-3.21

-2.15

-2.48

-1.94

Gildan Activewear Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Beneish M-Score																-2.48	-2.25	-2.05	-2.46	-1.94

Competitive Comparison

For the Apparel Manufacturing subindustry, Gildan Activewear'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.

Gildan Activewear Beneish M-Score Distribution

For the Manufacturing - Apparel & Accessories industry and Consumer Cyclical sector, Gildan Activewear's Beneish M-Score distribution charts can be found below:

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

Gildan Activewear 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 Gildan Activewear 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 * 1.6812

0.528 * 1.1122

0.404 * 1.0752

0.892 * 0.9862

0.115 * 1.0734

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0268

4.679 * -0.03046

0.327 * 0.973

-1.91

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was $412 Mil.
Revenue was 782.709 + 869.901 + 840.438 + 702.863 = $3,196 Mil.
Gross Profit was 236.558 + 239.237 + 216.596 + 187.663 = $880 Mil.
Total Current Assets was $1,688 Mil.
Total Assets was $3,515 Mil.
Property, Plant and Equipment(Net PPE) was $1,256 Mil.
Depreciation, Depletion and Amortization(DDA) was $122 Mil.
Selling, General, & Admin. Expense(SGA) was $330 Mil.
Total Current Liabilities was $724 Mil.
Long-Term Debt & Capital Lease Obligation was $769 Mil.
Net Income was 153.308 + 127.367 + 155.288 + 97.617 = $534 Mil.
Non Operating Income was 29.3 + -1.949 + 44.026 + 22.66 = $94 Mil.
Cash Flow from Operations was 239.061 + 305.137 + 181.825 + -179.417 = $547 Mil.

Total Receivables was $249 Mil.
Revenue was 720.022 + 850.008 + 895.581 + 774.871 = $3,240 Mil.
Gross Profit was 234.825 + 252.169 + 264.985 + 240.433 = $992 Mil.
Total Current Assets was $1,727 Mil.
Total Assets was $3,440 Mil.
Property, Plant and Equipment(Net PPE) was $1,193 Mil.
Depreciation, Depletion and Amortization(DDA) was $125 Mil.
Selling, General, & Admin. Expense(SGA) was $326 Mil.
Total Current Liabilities was $642 Mil.
Long-Term Debt & Capital Lease Obligation was $860 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)
	=	(412.498 / 3195.911)	/	(248.785 / 3240.482)
	=	0.129071	/	0.076774
	=	1.6812

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)
	=	(992.412 / 3240.482)	/	(880.054 / 3195.911)
	=	0.306254	/	0.275369
	=	1.1122

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 - (1687.536 + 1255.962) / 3514.873)	/	(1 - (1726.952 + 1193.127) / 3440.214)
	=	0.162559	/	0.151193
	=	1.0752

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
	=	3195.911	/	3240.482
	=	0.9862

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))
	=	(124.926 / (124.926 + 1193.127))	/	(121.644 / (121.644 + 1255.962))
	=	0.094781	/	0.088301
	=	1.0734

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)
	=	(330.391 / 3195.911)	/	(326.258 / 3240.482)
	=	0.103379	/	0.100682
	=	1.0268

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)
	=	((768.9 + 724.09) / 3514.873)	/	((860.162 + 641.673) / 3440.214)
	=	0.424764	/	0.436553
	=	0.973

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
	=	(533.58 - 94.037	-	546.606)	/	3514.873
	=	-0.03046

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.

Gildan Activewear has a M-score of -1.91 suggests that the company is unlikely to be a manipulator.

Gildan Activewear Beneish M-Score Related Terms

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Gildan Activewear (Gildan Activewear) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Manufacturing - Apparel & Accessories » Gildan Activewear Inc (NYSE:GIL) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

VGA:Germany GIL:Canada

Address

600 de Maisonneuve Boulevard West, 33rd Floor, Suite 330, Montreal, QC, CAN, H3A 3J2

Website

http://www.gildan.com

Gildan is a vertically integrated designer and manufacturer of basic apparel, including T-shirts, underwear, socks, and hosiery. Its primary market is the sale of blank T-shirts, sweatshirts, and other apparel to wholesalers, major clothing brands, and printers (printwear). Gildan also sells branded clothing through retail and direct-to-consumer channels. Brands include Gildan, American Apparel, Comfort Colors, and Gold Toe. Gildan produces most of its clothing at factories in Latin America and recently began operating a new plant in Bangladesh. Incorporated in 1984, the Montreal-based company operates internationally but generates nearly 90% of its sales in the U.S.