GURUFOCUS.COM » STOCK LIST » Technology » Software » Needs Well Inc (TSE:3992) » Definitions » Beneish M-Score

Needs Well (TSE:3992) Beneish M-Score : -2.10 (As of Apr. 30, 2024)


View and export this data going back to 2017. Start your Free Trial

What is Needs Well 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 -2.1 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

TSE:3992' s Beneish M-Score Range Over the Past 10 Years
Min: -2.69   Med: -2.06   Max: -1.75
Current: -2.1

During the past 9 years, the highest Beneish M-Score of Needs Well was -1.75. The lowest was -2.69. And the median was -2.06.


Needs Well Beneish M-Score Historical Data

The historical data trend for Needs Well'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.

Needs Well Beneish M-Score Chart

Needs Well Annual Data
Trend Sep15 Sep16 Sep17 Sep18 Sep19 Sep20 Sep21 Sep22 Sep23
Beneish M-Score
Get a 7-Day Free Trial Premium Member Only -2.03 -2.50 -2.06 -2.02 -2.10

Needs Well 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 Get a 7-Day Free Trial 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 - - - -2.10 -

Competitive Comparison of Needs Well's Beneish M-Score

For the Software - Infrastructure subindustry, Needs Well'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.


Needs Well's Beneish M-Score Distribution in the Software Industry

For the Software industry and Technology sector, Needs Well's Beneish M-Score distribution charts can be found below:

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



Needs Well 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 Needs Well 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 * 1.2068+0.528 * 0.9764+0.404 * 1.6985+0.892 * 1.3018+0.115 * 0.5258
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0252+4.679 * -0.023788-0.327 * 1.5558
=-2.10

* 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 (Sep23) TTM:Last Year (Sep22) TTM:
Total Receivables was 円1,828 Mil.
Revenue was 円8,762 Mil.
Gross Profit was 円2,084 Mil.
Total Current Assets was 円4,379 Mil.
Total Assets was 円5,948 Mil.
Property, Plant and Equipment(Net PPE) was 円153 Mil.
Depreciation, Depletion and Amortization(DDA) was 円141 Mil.
Selling, General, & Admin. Expense(SGA) was 円170 Mil.
Total Current Liabilities was 円2,047 Mil.
Long-Term Debt & Capital Lease Obligation was 円38 Mil.
Net Income was 円837 Mil.
Gross Profit was 円0 Mil.
Cash Flow from Operations was 円979 Mil.
Total Receivables was 円1,163 Mil.
Revenue was 円6,730 Mil.
Gross Profit was 円1,563 Mil.
Total Current Assets was 円3,844 Mil.
Total Assets was 円4,608 Mil.
Property, Plant and Equipment(Net PPE) was 円118 Mil.
Depreciation, Depletion and Amortization(DDA) was 円40 Mil.
Selling, General, & Admin. Expense(SGA) was 円127 Mil.
Total Current Liabilities was 円1,038 Mil.
Long-Term Debt & Capital Lease Obligation was 円0 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)
=(1827.706 / 8761.59) / (1163.387 / 6730.166)
=0.208604 / 0.172862
=1.2068

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)
=(1562.976 / 6730.166) / (2083.988 / 8761.59)
=0.232234 / 0.237855
=0.9764

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 - (4379.208 + 153.309) / 5947.982) / (1 - (3844.118 + 118.454) / 4608.224)
=0.237974 / 0.140109
=1.6985

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
=8761.59 / 6730.166
=1.3018

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))
=(39.98 / (39.98 + 118.454)) / (141.464 / (141.464 + 153.309))
=0.252345 / 0.479908
=0.5258

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)
=(170.117 / 8761.59) / (127.463 / 6730.166)
=0.019416 / 0.018939
=1.0252

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)
=((38.044 + 2046.727) / 5947.982) / ((0 + 1038.186) / 4608.224)
=0.350501 / 0.22529
=1.5558

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
=(837.302 - 0 - 978.792) / 5947.982
=-0.023788

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.

Needs Well has a M-score of -2.10 suggests that the company is unlikely to be a manipulator.


Needs Well Beneish M-Score Related Terms

Thank you for viewing the detailed overview of Needs Well's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.


Needs Well (TSE:3992) Business Description

Traded in Other Exchanges
N/A
Address
13-15 South Tower, Tomihisa-cho Shinjuku-ku, Tokyo, JPN, 162-0067
Needs Well Inc provides application development, cloud solutions, IT related products and services, system infrastructure service and IT outsourcing services. Its services support to the development of BtoC / BtoB system, digital marketing related system, business system, CMS using web technology.

Needs Well (TSE:3992) Headlines

No Headlines