Hong Ho Precision Textile Co (TPE:1446) Beneish M-Score : 1.60 (As of May. 29, 2024)

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What is Hong Ho Precision Textile 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.

Warning Sign:

Beneish M-Score 1.6 higher than -1.78, which implies that the company might have manipulated its financial results.

The historical rank and industry rank for Hong Ho Precision Textile Co's Beneish M-Score or its related term are showing as below:

TPE:1446' s Beneish M-Score Range Over the Past 10 Years
Min: -3.49 Med: -2.06 Max: 3.82
Current: 1.6

During the past 13 years, the highest Beneish M-Score of Hong Ho Precision Textile Co was 3.82. The lowest was -3.49. And the median was -2.06.

Hong Ho Precision Textile Co Beneish M-Score Historical Data

The historical data trend for Hong Ho Precision Textile 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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Hong Ho Precision Textile Co Beneish M-Score Chart

Hong Ho Precision Textile Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.62

-3.31

3.82

-2.55

-1.56

Hong Ho Precision Textile 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															-2.99	-3.02	-3.11	-1.56	1.60

Competitive Comparison of Hong Ho Precision Textile Co's Beneish M-Score

For the Textile Manufacturing subindustry, Hong Ho Precision Textile 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.

Hong Ho Precision Textile Co's Beneish M-Score Distribution in the Manufacturing - Apparel & Accessories Industry

For the Manufacturing - Apparel & Accessories industry and Consumer Cyclical sector, Hong Ho Precision Textile Co's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Hong Ho Precision Textile Co's Beneish M-Score falls into.

Hong Ho Precision Textile 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 Hong Ho Precision Textile 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 * 0.0946

0.528 * 0.2572

0.404 * 1.0024

0.892 * 7.839

0.115 * 0.8037

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.2984

4.679 * -0.202236

0.327 * 0.8539

1.60

This Year (Mar24) TTM:

Last Year (Mar23) TTM:

Total Receivables was NT$11 Mil.
Revenue was 717.551 + 474.806 + 26.034 + 36.87 = NT$1,255 Mil.
Gross Profit was 364.066 + 232.288 + 1.504 + 2.966 = NT$601 Mil.
Total Current Assets was NT$3,918 Mil.
Total Assets was NT$4,468 Mil.
Property, Plant and Equipment(Net PPE) was NT$30 Mil.
Depreciation, Depletion and Amortization(DDA) was NT$11 Mil.
Selling, General, & Admin. Expense(SGA) was NT$141 Mil.
Total Current Liabilities was NT$2,631 Mil.
Long-Term Debt & Capital Lease Obligation was NT$21 Mil.
Net Income was 293.208 + 135.78 + -6.743 + -6.15 = NT$416 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = NT$0 Mil.
Cash Flow from Operations was 740.267 + 566.844 + 50.977 + -38.33 = NT$1,320 Mil.

Total Receivables was NT$14 Mil.
Revenue was 35.584 + 45.557 + 42.955 + 36.035 = NT$160 Mil.
Gross Profit was 4.203 + 6.177 + 4.906 + 4.425 = NT$20 Mil.
Total Current Assets was NT$4,116 Mil.
Total Assets was NT$4,702 Mil.
Property, Plant and Equipment(Net PPE) was NT$41 Mil.
Depreciation, Depletion and Amortization(DDA) was NT$11 Mil.
Selling, General, & Admin. Expense(SGA) was NT$60 Mil.
Total Current Liabilities was NT$517 Mil.
Long-Term Debt & Capital Lease Obligation was NT$2,752 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)
	=	(10.637 / 1255.261)	/	(14.345 / 160.131)
	=	0.008474	/	0.089583
	=	0.0946

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)
	=	(19.711 / 160.131)	/	(600.824 / 1255.261)
	=	0.123093	/	0.478645
	=	0.2572

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 - (3918.096 + 30.367) / 4468.361)	/	(1 - (4115.687 + 40.547) / 4702.031)
	=	0.116351	/	0.116077
	=	1.0024

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
	=	1255.261	/	160.131
	=	7.839

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))
	=	(11.424 / (11.424 + 40.547))	/	(11.433 / (11.433 + 30.367))
	=	0.219815	/	0.273517
	=	0.8037

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)
	=	(140.666 / 1255.261)	/	(60.144 / 160.131)
	=	0.112061	/	0.375592
	=	0.2984

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)
	=	((21.216 + 2630.851) / 4468.361)	/	((2751.528 + 516.659) / 4702.031)
	=	0.593521	/	0.695059
	=	0.8539

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
	=	(416.095 - 0	-	1319.758)	/	4468.361
	=	-0.202236

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.

Hong Ho Precision Textile Co has a M-score of 1.60 signals that the company is likely to be a manipulator.

Hong Ho Precision Textile Co Beneish M-Score Related Terms

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Hong Ho Precision Textile Co (TPE:1446) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Manufacturing - Apparel & Accessories » Hong Ho Precision Textile Co Ltd (TPE:1446) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

N/A

Address

NO.473,Zhongshan S.Road, Yong-kang District, Tainan City, TWN

Website

http://www.hongho.com.tw

Hong Ho Precision Textile Co Ltd is a Taiwan-based which is engaged in the manufacturing and selling of finished fabrics, apparel, and gray fabrics. Its fabrics include home textile fabrics, city wear fabrics, and sportswear fabrics.

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