China Automotive Systems Stock Beneish M Score

CAAS Stock  USD 3.91  0.01  0.26%   
This module uses fundamental data of China Automotive to approximate the value of its Beneish M Score. China Automotive M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out China Automotive Piotroski F Score and China Automotive Altman Z Score analysis.
  
At this time, China Automotive's Net Debt is comparatively stable compared to the past year. Long Term Debt is likely to gain to about 2.2 M in 2024, whereas Short Term Debt is likely to drop slightly above 85.6 M in 2024. At this time, China Automotive's Return On Tangible Assets are comparatively stable compared to the past year. Earnings Yield is likely to gain to 0.41 in 2024, whereas Dividend Yield is likely to drop 0.0005 in 2024.
At this time, it appears that China Automotive Systems is an unlikely manipulator. The earnings manipulation may begin if China Automotive's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by China Automotive executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of China Automotive's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-2.6
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables

1.28

Focus
Asset Quality

0.79

Focus
Expense Coverage

1.54

Focus
Gross Margin Strengs

1.39

Focus
Accruals Factor

1.54

Focus
Depreciation Resistance

0.95

Focus
Net Sales Growth

0.62

Focus
Financial Leverage Condition

1.06

Focus

China Automotive Beneish M-Score Indicator Trends

The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if China Automotive's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Current ValueLast YearChange From Last Year 10 Year Trend
Net Receivables211.4 M269.4 M
Significantly Down
Pretty Stable
Total Revenue354.5 M576.4 M
Way Down
Slightly volatile
Total Assets476.6 M766.4 M
Way Down
Slightly volatile
Total Current Assets354 M564.1 M
Way Down
Slightly volatile
Non Current Assets Total129.2 M202.4 M
Way Down
Slightly volatile
Property Plant Equipment90.8 M123.1 M
Way Down
Slightly volatile
Depreciation And Amortization14.7 M18.7 M
Significantly Down
Slightly volatile
Selling General Administrative18.4 M19.4 M
Notably Down
Slightly volatile
Total Current Liabilities243.2 M383.7 M
Way Down
Slightly volatile
Non Current Liabilities Total14.5 M14.3 M
Fairly Up
Slightly volatile
Short Term Debt85.6 M141.2 M
Way Down
Slightly volatile
Short Term Investments16.7 M11.1 M
Way Up
Slightly volatile
Long Term Investments41 M68.8 M
Way Down
Slightly volatile
Gross Profit Margin0.250.18
Significantly Up
Slightly volatile

China Automotive Systems Beneish M-Score Driver Matrix

One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between China Automotive's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards China Automotive in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find China Automotive's degree of accounting gimmicks and manipulations.

About China Automotive Beneish M Score

M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.

Depreciation And Amortization

14.67 Million

At this time, China Automotive's Depreciation And Amortization is comparatively stable compared to the past year.

China Automotive Earnings Manipulation Drivers

Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as China Automotive. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
201920202021202220232024 (projected)
Net Receivables233.0M234.1M210.3M224.3M269.4M211.4M
Total Revenue431.4M417.6M498.0M529.6M576.4M354.5M
Total Assets660.0M707.6M716.8M714.4M766.4M476.6M
Total Current Assets441.2M475.7M501.4M520.7M564.1M354.0M
Net Debt47.4M(52.7M)(2.0M)(74.5M)27.8M29.2M
Short Term Debt116.7M44.4M129.7M130.4M141.2M85.6M
Long Term Debt291K4.9M1.1M528K1.2M2.2M
Operating Income10.0M(10.6M)11.3M24.5M39.2M20.5M
Investments13.1M(23.8M)3.0M(32.7M)(15.7M)(14.9M)
Gross Profit Margin0.170.130.150.140.160.25

China Automotive ESG Sustainability

Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, China Automotive's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to China Automotive's managers, analysts, and investors.
Environmental
Governance
Social

About China Automotive Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze China Automotive Systems's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of China Automotive using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of China Automotive Systems based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.

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Additional Tools for China Stock Analysis

When running China Automotive's price analysis, check to measure China Automotive's market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy China Automotive is operating at the current time. Most of China Automotive's value examination focuses on studying past and present price action to predict the probability of China Automotive's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move China Automotive's price. Additionally, you may evaluate how the addition of China Automotive to your portfolios can decrease your overall portfolio volatility.