Sincere Watch (Hong Kong) (HKSE:00444) Beneish M-Score : -5.82 (As of May. 21, 2024)

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What is Sincere Watch (Hong Kong) 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 -5.82 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Sincere Watch (Hong Kong)'s Beneish M-Score or its related term are showing as below:

HKSE:00444' s Beneish M-Score Range Over the Past 10 Years
Min: -5.82 Med: -2.5 Max: -0.66
Current: -5.82

During the past 13 years, the highest Beneish M-Score of Sincere Watch (Hong Kong) was -0.66. The lowest was -5.82. And the median was -2.50.

Sincere Watch (Hong Kong) Beneish M-Score Historical Data

The historical data trend for Sincere Watch (Hong Kong)'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 Watch (Hong Kong) Beneish M-Score Chart

Sincere Watch (Hong Kong) Annual Data

Trend

Mar14

Mar15

Mar16

Mar17

Mar18

Mar19

Mar20

Mar21

Mar22

Mar23

Beneish M-Score

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-2.67

-3.81

-1.53

-2.44

-5.82

Sincere Watch (Hong Kong) Semi-Annual Data
	Mar14	Sep14	Mar15	Sep15	Mar16	Sep16	Mar17	Sep17	Mar18	Sep18	Mar19	Sep19	Mar20	Sep20	Mar21	Sep21	Mar22	Sep22	Mar23	Sep23
Beneish M-Score	Get a 7-Day Free Trial															-	-2.44	-	-5.82	-

Competitive Comparison of Sincere Watch (Hong Kong)'s Beneish M-Score

For the Luxury Goods subindustry, Sincere Watch (Hong Kong)'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 Watch (Hong Kong)'s Beneish M-Score Distribution in the Retail - Cyclical Industry

For the Retail - Cyclical industry and Consumer Cyclical sector, Sincere Watch (Hong Kong)'s Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Sincere Watch (Hong Kong)'s Beneish M-Score falls into.

Sincere Watch (Hong Kong) 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 Watch (Hong Kong) 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 * 1.4982

0.528 * -1.8114

0.404 * 1.1233

0.892 * 0.6604

0.115 * 0.8709

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.9782

4.679 * -0.367858

0.327 * 1.4883

-5.82

This Year (Mar23) TTM:

Last Year (Mar22) TTM:

Total Receivables was HK$39.5 Mil.
Revenue was HK$98.2 Mil.
Gross Profit was HK$-20.7 Mil.
Total Current Assets was HK$284.5 Mil.
Total Assets was HK$776.1 Mil.
Property, Plant and Equipment(Net PPE) was HK$29.9 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$26.6 Mil.
Selling, General, & Admin. Expense(SGA) was HK$139.4 Mil.
Total Current Liabilities was HK$270.2 Mil.
Long-Term Debt & Capital Lease Obligation was HK$264.5 Mil.
Net Income was HK$-274.5 Mil.
Gross Profit was HK$0.0 Mil.
Cash Flow from Operations was HK$11.0 Mil.

Total Receivables was HK$40.0 Mil.
Revenue was HK$148.7 Mil.
Gross Profit was HK$56.8 Mil.
Total Current Assets was HK$434.5 Mil.
Total Assets was HK$1,018.2 Mil.
Property, Plant and Equipment(Net PPE) was HK$44.4 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$30.9 Mil.
Selling, General, & Admin. Expense(SGA) was HK$106.7 Mil.
Total Current Liabilities was HK$170.2 Mil.
Long-Term Debt & Capital Lease Obligation was HK$301.1 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)
	=	(39.529 / 98.212)	/	(39.954 / 148.719)
	=	0.402486	/	0.268654
	=	1.4982

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)
	=	(56.839 / 148.719)	/	(-20.722 / 98.212)
	=	0.382191	/	-0.210993
	=	-1.8114

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 - (284.467 + 29.903) / 776.145)	/	(1 - (434.459 + 44.437) / 1018.207)
	=	0.59496	/	0.529667
	=	1.1233

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
	=	98.212	/	148.719
	=	0.6604

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))
	=	(30.886 / (30.886 + 44.437))	/	(26.605 / (26.605 + 29.903))
	=	0.410047	/	0.470818
	=	0.8709

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)
	=	(139.418 / 98.212)	/	(106.723 / 148.719)
	=	1.419562	/	0.717615
	=	1.9782

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)
	=	((264.508 + 270.193) / 776.145)	/	((301.116 + 170.212) / 1018.207)
	=	0.688919	/	0.4629
	=	1.4883

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
	=	(-274.5 - 0	-	11.011)	/	776.145
	=	-0.367858

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 Watch (Hong Kong) has a M-score of -5.82 suggests that the company is unlikely to be a manipulator.

Sincere Watch (Hong Kong) Beneish M-Score Related Terms

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Sincere Watch (Hong Kong) (HKSE:00444) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Retail - Cyclical » Sincere Watch (Hong Kong) Ltd (HKSE:00444) » Definitions » Beneish M-Score

Traded in Other Exchanges

N/A

Address

20/F China Merchants Tower, Shun Tak Centre, Unit 2016–2018, 168–200 Connaught Road Central, Hong Kong, HKG

Website

http://www.sincerewatch.com.hk

Sincere Watch (Hong Kong) Ltd sells luxury third-party-branded watches, timepieces, and accessories in Asia. The majority of its sales are in Mainland China and Macau, with the remaining sales in Hong Kong. Brands that Sincere sells include Franck Muller, CVSTOS, Pierre Kunz, European Company Watch, and Backes & Strauss. The company sells merchandise through retail outlets operated by independent watch dealers and through its company-operated boutiques. Sincere also has a dining business that accounts for a small amount of total revenue.

Sincere Watch (Hong Kong) (HKSE:00444) Headlines

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