Wuxi AppTec Co (HKSE:02359) Beneish M-Score : -2.63 (As of May. 12, 2024)

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What is Wuxi AppTec 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 Wuxi AppTec Co's Beneish M-Score or its related term are showing as below:

HKSE:02359' s Beneish M-Score Range Over the Past 10 Years
Min: -2.82 Med: -2.21 Max: -0.39
Current: -2.63

During the past 10 years, the highest Beneish M-Score of Wuxi AppTec Co was -0.39. The lowest was -2.82. And the median was -2.21.

Wuxi AppTec Co Beneish M-Score Historical Data

The historical data trend for Wuxi AppTec 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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Wuxi AppTec Co Beneish M-Score Chart

Wuxi AppTec Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.56

-2.21

-2.28

-2.21

-2.53

Wuxi AppTec Co Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
Beneish M-Score	Get a 7-Day Free Trial															-2.60	-2.46	-2.54	-2.53	-2.63

Competitive Comparison of Wuxi AppTec Co's Beneish M-Score

For the Diagnostics & Research subindustry, Wuxi AppTec 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.

Wuxi AppTec Co's Beneish M-Score Distribution in the Medical Diagnostics & Research Industry

For the Medical Diagnostics & Research industry and Healthcare sector, Wuxi AppTec Co's Beneish M-Score distribution charts can be found below:

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

Wuxi AppTec 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 Wuxi AppTec 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 * 1.0708

0.528 * 0.9349

0.404 * 0.9687

0.892 * 0.9456

0.115 * 1

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.8978

4.679 * -0.042942

0.327 * 0.9237

-2.67

This Year (Mar24) TTM:

Last Year (Mar23) TTM:

Total Receivables was HK$9,152 Mil.
Revenue was 8670.787 + 11812.244 + 11445.815 + 10836.679 = HK$42,766 Mil.
Gross Profit was 3306.215 + 4825.739 + 4885.329 + 4451.63 = HK$17,469 Mil.
Total Current Assets was HK$33,842 Mil.
Total Assets was HK$81,407 Mil.
Property, Plant and Equipment(Net PPE) was HK$27,854 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$0 Mil.
Selling, General, & Admin. Expense(SGA) was HK$1,634 Mil.
Total Current Liabilities was HK$14,543 Mil.
Long-Term Debt & Capital Lease Obligation was HK$4,261 Mil.
Net Income was 2109.827 + 1673.856 + 2964.194 + 3439.93 = HK$10,188 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = HK$0 Mil.
Cash Flow from Operations was 2451.911 + 3358.037 + 5061.677 + 2811.947 = HK$13,684 Mil.

Total Receivables was HK$9,039 Mil.
Revenue was 10209.656 + 12239.435 + 11896.047 + 10880.153 = HK$45,225 Mil.
Gross Profit was 4072.886 + 4619.575 + 4589.047 + 3989.993 = HK$17,272 Mil.
Total Current Assets was HK$31,325 Mil.
Total Assets was HK$77,666 Mil.
Property, Plant and Equipment(Net PPE) was HK$26,928 Mil.
Depreciation, Depletion and Amortization(DDA) was HK$0 Mil.
Selling, General, & Admin. Expense(SGA) was HK$1,925 Mil.
Total Current Liabilities was HK$17,980 Mil.
Long-Term Debt & Capital Lease Obligation was HK$1,440 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)
	=	(9152.44 / 42765.525)	/	(9039.095 / 45225.291)
	=	0.214014	/	0.199868
	=	1.0708

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)
	=	(17271.501 / 45225.291)	/	(17468.913 / 42765.525)
	=	0.381899	/	0.408481
	=	0.9349

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 - (33841.965 + 27854.407) / 81407.267)	/	(1 - (31325.082 + 26928.208) / 77665.886)
	=	0.242127	/	0.24995
	=	0.9687

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
	=	42765.525	/	45225.291
	=	0.9456

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 + 26928.208))	/	(0 / (0 + 27854.407))
	=	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)
	=	(1634.452 / 42765.525)	/	(1925.174 / 45225.291)
	=	0.038219	/	0.042569
	=	0.8978

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)
	=	((4260.964 + 14542.788) / 81407.267)	/	((1440.419 + 17980.42) / 77665.886)
	=	0.230984	/	0.250056
	=	0.9237

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
	=	(10187.807 - 0	-	13683.572)	/	81407.267
	=	-0.042942

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.

Wuxi AppTec Co has a M-score of -2.67 suggests that the company is unlikely to be a manipulator.

Wuxi AppTec Co Beneish M-Score Related Terms

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Wuxi AppTec Co (HKSE:02359) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Diagnostics & Research » Wuxi AppTec Co Ltd (HKSE:02359) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

WUXIF:USA WUXAY:USA WX8:Germany 603259:China

Address

288 Fute Zhong Road, Waigaoqiao Free Trade Zone, Shanghai, CHN, 200131

Website

https://www.wuxiapptec.com

Wuxi AppTec Co Ltd provides a portfolio of research and manufacturing services through the discovery, development, and manufacturing spectrum for small-molecule drugs, cell therapies, and gene therapies as well as providing testing services for medical devices. Its segments comprise China-based laboratory services; U.S.-based laboratory services; Clinical research and other CRO services; CDMO services; and Others. The majority of revenue gets derived from China-based laboratory services that include small molecules discovery, such as synthetic chemistry, medicinal chemistry, analytical chemistry, biology, drug metabolism and pharmacokinetics (DMPK)/absorption, distribution, metabolism, and excretion (ADME), toxicology and bioanalytical services.

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