Test Rite International Co (TPE:2908) Beneish M-Score : -2.63 (As of Dec. 12, 2024)

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What is Test Rite International 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.

Good Sign:

Beneish M-Score -2.63 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

TPE:2908' s Beneish M-Score Range Over the Past 10 Years
Min: -3.04 Med: -2.57 Max: -2.06
Current: -2.63

During the past 13 years, the highest Beneish M-Score of Test Rite International Co was -2.06. The lowest was -3.04. And the median was -2.57.

Test Rite International Co Beneish M-Score Historical Data

The historical data trend for Test Rite International 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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Test Rite International Co Beneish M-Score Chart

Test Rite International Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-3.04

-2.69

-2.41

-2.62

-2.38

Test Rite International Co Quarterly Data
	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
Beneish M-Score	Get a 7-Day Free Trial															-2.18	-2.38	-2.49	-2.74	-2.63

Competitive Comparison of Test Rite International Co's Beneish M-Score

For the Home Improvement Retail subindustry, Test Rite International 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.

Test Rite International Co's Beneish M-Score Distribution in the Retail - Cyclical Industry

For the Retail - Cyclical industry and Consumer Cyclical sector, Test Rite International Co's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Test Rite International Co's Beneish M-Score falls into.

Test Rite International 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 Test Rite International 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 * 1.0606

0.528 * 0.9575

0.404 * 1.0258

0.892 * 1.0224

0.115 * 0.9555

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0142

4.679 * -0.045331

0.327 * 0.9801

-2.63

This Year (Sep24) TTM:

Last Year (Sep23) TTM:

Total Receivables was NT$8,781 Mil.
Revenue was 8871.56 + 9856.848 + 9088.357 + 8362.416 = NT$36,179 Mil.
Gross Profit was 2295.419 + 2426.681 + 2341.3 + 2292.267 = NT$9,356 Mil.
Total Current Assets was NT$17,857 Mil.
Total Assets was NT$37,424 Mil.
Property, Plant and Equipment(Net PPE) was NT$13,150 Mil.
Depreciation, Depletion and Amortization(DDA) was NT$2,218 Mil.
Selling, General, & Admin. Expense(SGA) was NT$8,670 Mil.
Total Current Liabilities was NT$13,125 Mil.
Long-Term Debt & Capital Lease Obligation was NT$16,569 Mil.
Net Income was 74.43 + 99.749 + 126.891 + -14.946 = NT$286 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = NT$0 Mil.
Cash Flow from Operations was 170.936 + 531.833 + -20.992 + 1300.83 = NT$1,983 Mil.

Total Receivables was NT$8,097 Mil.
Revenue was 9164.302 + 9167.237 + 8716.634 + 8336.815 = NT$35,385 Mil.
Gross Profit was 2171.951 + 2111.317 + 2316.676 + 2161.424 = NT$8,761 Mil.
Total Current Assets was NT$16,838 Mil.
Total Assets was NT$37,780 Mil.
Property, Plant and Equipment(Net PPE) was NT$14,626 Mil.
Depreciation, Depletion and Amortization(DDA) was NT$2,339 Mil.
Selling, General, & Admin. Expense(SGA) was NT$8,361 Mil.
Total Current Liabilities was NT$13,093 Mil.
Long-Term Debt & Capital Lease Obligation was NT$17,493 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)
	=	(8780.618 / 36179.181)	/	(8097.449 / 35384.988)
	=	0.242698	/	0.228839
	=	1.0606

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)
	=	(8761.368 / 35384.988)	/	(9355.667 / 36179.181)
	=	0.247601	/	0.258593
	=	0.9575

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 - (17856.532 + 13150.057) / 37424.237)	/	(1 - (16837.934 + 14625.795) / 37779.691)
	=	0.171484	/	0.167179
	=	1.0258

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
	=	36179.181	/	35384.988
	=	1.0224

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))
	=	(2339.424 / (2339.424 + 14625.795))	/	(2217.952 / (2217.952 + 13150.057))
	=	0.137895	/	0.144323
	=	0.9555

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)
	=	(8670.014 / 36179.181)	/	(8360.957 / 35384.988)
	=	0.239641	/	0.236285
	=	1.0142

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)
	=	((16568.922 + 13125.352) / 37424.237)	/	((17493.042 + 13092.811) / 37779.691)
	=	0.79345	/	0.809585
	=	0.9801

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
	=	(286.124 - 0	-	1982.607)	/	37424.237
	=	-0.045331

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.

Test Rite International Co has a M-score of -2.63 suggests that the company is unlikely to be a manipulator.

Test Rite International Co Beneish M-Score Related Terms

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Test Rite International Co Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Retail - Cyclical » Test Rite International Co Ltd (TPE:2908) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

N/A

Address

No. 23, Hsin Hu 3rd Road, 6th Floor, Nai Hu District, Taipei, TWN, 114

Website

https://www.testritegroup.com

Test Rite International Co Ltd is a Taiwan-based company that is principally engaged in trading business and retail business. The trading business consists of the import and export of household goods and licensing business, such as DIY hand tools, furniture, electrical appliances, and other household items, and this segment provides products for retailers in a worldwide, like Wal-Mart, Sam's Club, Target, Staples, Office Depot, and Carrefour. The retail business in Taiwan and mainland China refers to the sale and marketing of household items and services directly to consumers. The company also conducts product design, packaging design, as well as logistics and warehousing services. The trading business and retail business jointly account for the majority of the company's total revenue.

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