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HP Beneish M-Score

: -2.71 (As of Today)
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The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

HP has a M-score of -2.71 suggests that the company is not a manipulator.

NYSE:HPQ' s Beneish M-Score Range Over the Past 10 Years
Min: -3.11   Med: -2.57   Max: -1.58
Current: -2.71

-3.11
-1.58

During the past 13 years, the highest Beneish M-Score of HP was -1.58. The lowest was -3.11. And the median was -2.57.


HP Beneish M-Score Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

HP Annual Data
Oct11 Oct12 Oct13 Oct14 Oct15 Oct16 Oct17 Oct18 Oct19 Oct20
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.69 -2.59 -2.14 -2.56 -2.71

HP Quarterly Data
Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17 Oct17 Jan18 Apr18 Jul18 Oct18 Jan19 Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.56 -2.82 -2.65 -2.50 -2.71

Competitive Comparison
* 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.


HP Beneish M-Score Distribution

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



HP 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 HP 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 * 0.9256+0.528 * 1.0317+0.404 * 1.0487+0.892 * 0.964+0.115 * 0.9104
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9481+4.679 * -0.0333-0.327 * 1.0192
=-2.71

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Oct20) TTM:Last Year (Oct19) TTM:
Accounts Receivable was $5,381 Mil.
Revenue was 15258 + 14294 + 12469 + 14618 = $56,639 Mil.
Gross Profit was 2679 + 2393 + 2493 + 2872 = $10,437 Mil.
Total Current Assets was $20,648 Mil.
Total Assets was $34,681 Mil.
Property, Plant and Equipment(Net PPE) was $2,627 Mil.
Depreciation, Depletion and Amortization(DDA) was $789 Mil.
Selling, General, & Admin. Expense(SGA) was $4,906 Mil.
Total Current Liabilities was $26,220 Mil.
Long-Term Debt & Capital Lease Obligation was $5,543 Mil.
Net Income was 668 + 734 + 764 + 678 = $2,844 Mil.
Non Operating Income was -33 + -42 + -21 + -220 = $-316 Mil.
Cash Flow from Operations was 1874 + 1667 + -510 + 1285 = $4,316 Mil.
Accounts Receivable was $6,031 Mil.
Revenue was 15407 + 14603 + 14036 + 14710 = $58,756 Mil.
Gross Profit was 2924 + 2905 + 2729 + 2612 = $11,170 Mil.
Total Current Assets was $20,177 Mil.
Total Assets was $33,467 Mil.
Property, Plant and Equipment(Net PPE) was $2,794 Mil.
(DDA) was $744 Mil.
Selling, General, & Admin. Expense(SGA) was $5,368 Mil.
Total Current Liabilities was $25,293 Mil.
Long-Term Debt & Capital Lease Obligation was $4,780 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Accounts Receivable 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)
=(5381 / 56639) / (6031 / 58756)
=0.09500521 / 0.10264484
=0.9256

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)
=(11170 / 58756) / (10437 / 56639)
=0.19010824 / 0.18427232
=1.0317

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 - (20648 + 2627) / 34681) / (1 - (20177 + 2794) / 33467)
=0.32888325 / 0.31362237
=1.0487

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
=56639 / 58756
=0.964

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))
=(744 / (744 + 2794)) / (789 / (789 + 2627))
=0.2102883 / 0.2309719
=0.9104

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)
=(4906 / 56639) / (5368 / 58756)
=0.08661876 / 0.09136088
=0.9481

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)
=((5543 + 26220) / 34681) / ((4780 + 25293) / 33467)
=0.91586171 / 0.89858667
=1.0192

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
=(2844 - -316 - 4316) / 34681
=-0.0333

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

HP has a M-score of -2.71 suggests that the company will not be a manipulator.


HP Beneish M-Score Headlines

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