Origen Financial (Origen Financial) Beneish M-Score : 0.00 (As of Apr. 30, 2024)

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What is Origen Financial Beneish M-Score?

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

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.

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

During the past 9 years, the highest Beneish M-Score of Origen Financial was 0.00. The lowest was 0.00. And the median was 0.00.

Origen Financial 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 Origen Financial 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

0.528 * 1

0.404 * 0.9996

0.892 * 0.3085

0.115 * 0.4347

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 2.8025

4.679 * -0.212529

0.327 * 0.9978

-4.47

* 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 (Dec08) TTM:

Last Year (Dec07) TTM:

Total Receivables was $0.00 Mil.
Revenue was 10.452 + 10.24 + 5.391 + -9.298 = $16.79 Mil.
Gross Profit was 10.452 + 10.24 + 5.391 + -9.298 = $16.79 Mil.
Total Current Assets was $14.12 Mil.
Total Assets was $965.53 Mil.
Property, Plant and Equipment(Net PPE) was $0.40 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.76 Mil.
Selling, General, & Admin. Expense(SGA) was $21.14 Mil.
Total Current Liabilities was $29.35 Mil.
Long-Term Debt & Capital Lease Obligation was $775.12 Mil.
Net Income was -4.425 + -1.173 + -4.774 + -24.992 = $-35.36 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 0.746 + 0.529 + 9.817 + 158.748 = $169.84 Mil.

Total Receivables was $0.00 Mil.
Revenue was 14.055 + 13.66 + 13.897 + 12.797 = $54.41 Mil.
Gross Profit was 14.055 + 13.66 + 13.897 + 12.797 = $54.41 Mil.
Total Current Assets was $10.79 Mil.
Total Assets was $1,284.20 Mil.
Property, Plant and Equipment(Net PPE) was $7.96 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.45 Mil.
Selling, General, & Admin. Expense(SGA) was $24.45 Mil.
Total Current Liabilities was $173.07 Mil.
Long-Term Debt & Capital Lease Obligation was $899.24 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)
	=	(0 / 16.785)	/	(0 / 54.409)
	=	0	/	0
	=	1

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)
	=	(54.409 / 54.409)	/	(16.785 / 16.785)
	=	1	/	1
	=	1

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 - (14.118 + 0.401) / 965.533)	/	(1 - (10.791 + 7.955) / 1284.201)
	=	0.984963	/	0.985403
	=	0.9996

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
	=	16.785	/	54.409
	=	0.3085

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))
	=	(5.445 / (5.445 + 7.955))	/	(5.755 / (5.755 + 0.401))
	=	0.406343	/	0.93486
	=	0.4347

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)
	=	(21.138 / 16.785)	/	(24.449 / 54.409)
	=	1.259339	/	0.449356
	=	2.8025

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)
	=	((775.12 + 29.351) / 965.533)	/	((899.243 + 173.072) / 1284.201)
	=	0.833189	/	0.835006
	=	0.9978

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
	=	(-35.364 - 0	-	169.84)	/	965.533
	=	-0.212529

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.

Origen Financial has a M-score of -4.47 suggests that the company is unlikely to be a manipulator.

Origen Financial Beneish M-Score Related Terms

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Origen Financial (Origen Financial) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » REITs » Origen Financial Inc (OTCPK:ORGN) » Definitions » Beneish M-Score

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Traded in Other Exchanges

N/A

Address

27777 Franklin Road, Suite 1700, Southfield, MI, USA, 48034

Website

http://www.origenfinancial.com

Origen Financial Inc is an internally-managed and internally-advised Delaware corporation that is taxed as a real estate investment trust. It is a national consumer manufactured housing lender and servicer.