Sincere Co (HKSE:00244) Beneish M-Score : -2.64 (As of May. 18, 2024)

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What is Sincere 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 -2.64 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

HKSE:00244' s Beneish M-Score Range Over the Past 10 Years
Min: -4.45 Med: -2.59 Max: 131.67
Current: -2.64

During the past 13 years, the highest Beneish M-Score of Sincere Co was 131.67. The lowest was -4.45. And the median was -2.59.

Sincere Co Beneish M-Score Historical Data

The historical data trend for Sincere 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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Sincere Co Beneish M-Score Chart

Sincere Co Annual Data

Trend

Feb14

Feb15

Feb16

Feb17

Feb18

Feb19

Feb20

Feb21

Dec22

Dec23

Beneish M-Score

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-2.95

-4.45

-1.78

-1.52

-2.64

Sincere Co Semi-Annual Data
	Feb14	Aug14	Feb15	Aug15	Feb16	Aug16	Feb17	Aug17	Feb18	Aug18	Feb19	Aug19	Feb20	Aug20	Feb21	Aug21	Jun22	Dec22	Jun23	Dec23
Beneish M-Score	Get a 7-Day Free Trial															-	-	-1.52	-	-2.64

Competitive Comparison of Sincere Co's Beneish M-Score

For the Department Stores subindustry, Sincere 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.

Sincere Co's Beneish M-Score Distribution in the Retail - Cyclical Industry

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

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

Sincere 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 Sincere 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 * 1.0657

0.528 * 0.9738

0.404 * 1.2333

0.892 * 0.9975

0.115 * 1.122

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0384

4.679 * -0.060098

0.327 * 1.0703

-2.64

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was HK$35.9 Mil.
Revenue was HK$146.1 Mil.
Gross Profit was HK$83.9 Mil.
Total Current Assets was HK$173.4 Mil.
Total Assets was HK$592.6 Mil.
Property, Plant and Equipment(Net PPE) was HK$189.3 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$35.1 Mil.
Selling, General, & Admin. Expense(SGA) was HK$46.1 Mil.
Total Current Liabilities was HK$253.1 Mil.
Long-Term Debt & Capital Lease Obligation was HK$212.2 Mil.
Net Income was HK$-50.5 Mil.
Gross Profit was HK$0.0 Mil.
Cash Flow from Operations was HK$-14.9 Mil.

Total Receivables was HK$33.8 Mil.
Revenue was HK$146.5 Mil.
Gross Profit was HK$81.9 Mil.
Total Current Assets was HK$249.2 Mil.
Total Assets was HK$682.7 Mil.
Property, Plant and Equipment(Net PPE) was HK$218.7 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$46.6 Mil.
Selling, General, & Admin. Expense(SGA) was HK$44.5 Mil.
Total Current Liabilities was HK$489.5 Mil.
Long-Term Debt & Capital Lease Obligation was HK$11.4 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)
	=	(35.899 / 146.147)	/	(33.771 / 146.516)
	=	0.245636	/	0.230494
	=	1.0657

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)
	=	(81.941 / 146.516)	/	(83.934 / 146.147)
	=	0.559263	/	0.574312
	=	0.9738

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 - (173.403 + 189.26) / 592.616)	/	(1 - (249.171 + 218.734) / 682.694)
	=	0.38803	/	0.31462
	=	1.2333

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
	=	146.147	/	146.516
	=	0.9975

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))
	=	(46.606 / (46.606 + 218.734))	/	(35.129 / (35.129 + 189.26))
	=	0.175646	/	0.156554
	=	1.122

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)
	=	(46.105 / 146.147)	/	(44.511 / 146.516)
	=	0.31547	/	0.303796
	=	1.0384

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)
	=	((212.181 + 253.134) / 592.616)	/	((11.387 + 489.468) / 682.694)
	=	0.785188	/	0.733645
	=	1.0703

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
	=	(-50.477 - 0	-	-14.862)	/	592.616
	=	-0.060098

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.

Sincere Co has a M-score of -2.64 suggests that the company is unlikely to be a manipulator.

Sincere Co Beneish M-Score Related Terms

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Sincere Co (HKSE:00244) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Retail - Cyclical » Sincere Co Ltd (HKSE:00244) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

N/A

Address

1 Connaught Place, 24th Floor, Jardine House, Central, Hong Kong, HKG

Website

https://www.sincere.com.hk

Sincere Co Ltd is mainly engaged in the retailing business. The company has aggregated its operations into three reportable segments, Department Store Operations; Securities Trading and Others. The Department Store Operations segment consists of the operations of department stores offering a wide range of consumer products; the Securities Trading segment consists of the trading of Hong Kong and overseas securities; and the Others segment consists of the sublease of properties and the provision of general and life insurances. Its primary geographic markets are Hong Kong, Mainland China, the United Kingdom and others. Geographically the company receives maximum revenue from Hong Kong.

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