Dream Residential REIT (TSX:DRR.U) Beneish M-Score : -1.45 (As of Apr. 08, 2025)

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What is Dream Residential REIT 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 -1.45 higher than -1.78, which implies that the company might have manipulated its financial results.

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

TSX:DRR.U' s Beneish M-Score Range Over the Past 10 Years
Min: -1.45 Med: -1.45 Max: -1.45
Current: -1.45

During the past 3 years, the highest Beneish M-Score of Dream Residential REIT was -1.45. The lowest was -1.45. And the median was -1.45.

Dream Residential REIT Beneish M-Score Historical Data

The historical data trend for Dream Residential REIT'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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Dream Residential REIT Beneish M-Score Chart

Dream Residential REIT Annual Data

Trend

Dec22

Dec23

Dec24

Beneish M-Score

-1.45

Dream Residential REIT Quarterly Data
	Feb22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24	Dec24
Beneish M-Score	Get a 7-Day Free Trial							-	-2.19	-2.10	-	-1.45

Competitive Comparison of Dream Residential REIT's Beneish M-Score

For the REIT - Residential subindustry, Dream Residential REIT'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.

Dream Residential REIT's Beneish M-Score Distribution in the REITs Industry

For the REITs industry and Real Estate sector, Dream Residential REIT's Beneish M-Score distribution charts can be found below:

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

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Dream Residential REIT 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 Dream Residential REIT 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 * 2.1594

0.528 * 0.9955

0.404 * 1.0116

0.892 * 1.009

0.115 * 1

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0974

4.679 * -0.014788

0.327 * 0.8774

-1.45

This Year (Dec24) TTM:

Last Year (Dec23) TTM:

Total Receivables was $1.78 Mil.
Revenue was 11.884 + 11.993 + 12.099 + 12.014 = $47.99 Mil.
Gross Profit was 2.732 + 7.839 + 7.984 + 6.633 = $25.19 Mil.
Total Current Assets was $8.43 Mil.
Total Assets was $409.66 Mil.
Property, Plant and Equipment(Net PPE) was $0.00 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.00 Mil.
Selling, General, & Admin. Expense(SGA) was $3.83 Mil.
Total Current Liabilities was $30.08 Mil.
Long-Term Debt & Capital Lease Obligation was $138.84 Mil.
Net Income was 4.218 + -2.023 + 3.346 + 0.816 = $6.36 Mil.
Non Operating Income was 4.74 + -6.827 + -1.4 + -2.678 = $-6.17 Mil.
Cash Flow from Operations was 3.509 + 7.045 + 3.996 + 4.03 = $18.58 Mil.

Total Receivables was $0.82 Mil.
Revenue was 11.997 + 11.97 + 11.955 + 11.639 = $47.56 Mil.
Gross Profit was 2.642 + 7.413 + 7.685 + 7.11 = $24.85 Mil.
Total Current Assets was $13.11 Mil.
Total Assets was $411.93 Mil.
Property, Plant and Equipment(Net PPE) was $0.00 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.00 Mil.
Selling, General, & Admin. Expense(SGA) was $3.46 Mil.
Total Current Liabilities was $55.94 Mil.
Long-Term Debt & Capital Lease Obligation was $137.63 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)
	=	(1.778 / 47.99)	/	(0.816 / 47.561)
	=	0.037049	/	0.017157
	=	2.1594

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)
	=	(24.85 / 47.561)	/	(25.188 / 47.99)
	=	0.522487	/	0.524859
	=	0.9955

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 - (8.427 + 0) / 409.664)	/	(1 - (13.114 + 0) / 411.926)
	=	0.979429	/	0.968164
	=	1.0116

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
	=	47.99	/	47.561
	=	1.009

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))
	=	(0 / (0 + 0))	/	(0 / (0 + 0))
	=		/
	=	1

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)
	=	(3.829 / 47.99)	/	(3.458 / 47.561)
	=	0.079787	/	0.072707
	=	1.0974

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)
	=	((138.835 + 30.075) / 409.664)	/	((137.632 + 55.942) / 411.926)
	=	0.412314	/	0.469924
	=	0.8774

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
	=	(6.357 - -6.165	-	18.58)	/	409.664
	=	-0.014788

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.

Dream Residential REIT has a M-score of -1.45 signals that the company is likely to be a manipulator.

Dream Residential REIT Beneish M-Score Related Terms

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Dream Residential REIT Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Real Estate » REITs » Dream Residential REIT (TSX:DRR.U) » Definitions » Beneish M-Score

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Traded in Other Exchanges

DRREF:USA

Address

30 Adelaide Street East, Suite 301, Toronto, ON, CAN, M5C 3H1

Website

https://www.dreamresidentialreit.ca

Dream Residential REIT is a Canada based open-ended, real estate investment trust. It plans to acquire all of the issued and outstanding equity interests in special purpose entities, which collectively own more than 15 multi-residential rental properties. All of its properties are located in the United States.

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