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Chubb (CB) Beneish M-Score : -2.44 (As of Oct. 29, 2024)


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What is Chubb Beneish M-Score?

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

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 -2.44 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

CB' s Beneish M-Score Range Over the Past 10 Years
Min: -3.12   Med: -2.48   Max: -2.02
Current: -2.44

During the past 13 years, the highest Beneish M-Score of Chubb was -2.02. The lowest was -3.12. And the median was -2.48.


Chubb 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 Chubb 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 * 0.9342+0.528 * 1+0.404 * 1+0.892 * 1.1596+0.115 * 1
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9963+4.679 * -0.022033-0.327 * 0.8235
=-2.44

* 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 (Jun24) TTM:Last Year (Jun23) TTM:
Total Receivables was $35,575 Mil.
Revenue was 13903 + 12957 + 13084 + 13889 = $53,833 Mil.
Gross Profit was 13903 + 12957 + 13084 + 13889 = $53,833 Mil.
Total Current Assets was $0 Mil.
Total Assets was $238,551 Mil.
Property, Plant and Equipment(Net PPE) was $0 Mil.
Depreciation, Depletion and Amortization(DDA) was $328 Mil.
Selling, General, & Admin. Expense(SGA) was $4,272 Mil.
Total Current Liabilities was $0 Mil.
Long-Term Debt & Capital Lease Obligation was $13,178 Mil.
Net Income was 2230 + 2143 + 3300 + 2043 = $9,716 Mil.
Non Operating Income was -29 + 21 + -153 + -32 = $-193 Mil.
Cash Flow from Operations was 4079 + 3220 + 3186 + 4680 = $15,165 Mil.
Total Receivables was $32,841 Mil.
Revenue was 11821 + 11032 + 11517 + 12055 = $46,425 Mil.
Gross Profit was 11821 + 11032 + 11517 + 12055 = $46,425 Mil.
Total Current Assets was $0 Mil.
Total Assets was $205,448 Mil.
Property, Plant and Equipment(Net PPE) was $0 Mil.
Depreciation, Depletion and Amortization(DDA) was $285 Mil.
Selling, General, & Admin. Expense(SGA) was $3,698 Mil.
Total Current Liabilities was $0 Mil.
Long-Term Debt & Capital Lease Obligation was $13,782 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)
=(35575 / 53833) / (32841 / 46425)
=0.66084 / 0.707399
=0.9342

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)
=(46425 / 46425) / (53833 / 53833)
=1 / 1
=1

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 - (0 + 0) / 238551) / (1 - (0 + 0) / 205448)
=1 / 1
=1

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
=53833 / 46425
=1.1596

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))
=(285 / (285 + 0)) / (328 / (328 + 0))
=1 / 1
=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)
=(4272 / 53833) / (3698 / 46425)
=0.079357 / 0.079655
=0.9963

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)
=((13178 + 0) / 238551) / ((13782 + 0) / 205448)
=0.055242 / 0.067083
=0.8235

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
=(9716 - -193 - 15165) / 238551
=-0.022033

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.

Chubb has a M-score of -2.44 suggests that the company is unlikely to be a manipulator.


Chubb Business Description

Traded in Other Exchanges
Address
Baerengasse 32, Zurich, CHE, CH-8001
ACE acquired Chubb in the first quarter of 2016 and assumed the Chubb name. The combination made the new Chubb one of the largest domestic property and casualty insurers, with operations in 54 countries spanning commercial and personal P&C insurance, reinsurance, and life insurance.
Executives
Evan G Greenberg director, officer: President & COO THE CHUBB BUILDING, 17 WOODBOURNE AVENUE, HAMILTON D0 HM 08
Joseph F Wayland officer: General Counsel 1133 AVENUE OF THE AMERICAS, 45TH FLOOR, NEW YORK NY 10036
John J Lupica officer: Chrm, Ins - NA, Pres.- ACE USA 436 WALNUT STREET, PHILADELPHIA PA 19106-3703
Michael G Atieh director MERCK MEDCO MANAGED CARE INC, 100 SUMMIT AVE, MONTVALE NJ 07645
Juan Luis Ortega officer: Executive Vice President* CHUBB, AVENUE OF THE AMERICAS, NEW YORK NY 10036
Timothy Alan Boroughs officer: Chief Investment Officer* 1133 AVENUE OF THE AMERICAS, NEW YORK NY 10036
Peter C. Enns officer: Executive Vice President and* THE CHUBB BUILDING, 17 WOODBOURNE AVENUE, HAMILTON D0 HM 08
Annmarie T Hagan officer: Chief Accounting Officer TWO LIBERTY PLACE, 1601 CHESTNUT STREET, PHILADELPHIA PA 19192
John W Keogh officer: CEO of ACE Overseas General ACE OVERSEAS GENERAL, 1133 AVENUE OF THE AMERICAS, NEW YORK NY 10036
Theodore Shasta director C/O MBIA INC., 113 KING STREET, ARMONK NY 10504
Frances D. O'brien officer: Chief Risk Officer THE CHUBB BUILDING, 17 WOODBOURNE AVENUE, HAMILTON D0 HM 08
Nancy Buese director 1515 ARAPAHOE STREET, DENVER CO 80202-2126
Michael Corbat director 388 GREENWICH STREET, 17TH FLOOR, NEW YORK NY 10013
Bryce L. Johns officer: Senior Vice President, * THE CHUBB BUILDING, 17 WOODBOURNE AVENUE, HAMILTON D0 HM 08
Sean Ringsted officer: Chief Risk Officer and* THE ACE BLDG., 17 WOODBOURNE AVE., HAMILTON D0 HM 08