Kwesst Micro Systems Stock Beneish M Score

KWE Stock   0.61  0.02  3.17%   
This module uses fundamental data of KWESST Micro to approximate the value of its Beneish M Score. KWESST Micro 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 KWESST Micro Piotroski F Score and KWESST Micro Altman Z Score analysis.
  
At present, KWESST Micro's Total Debt To Capitalization is projected to increase slightly based on the last few years of reporting. The current year's Debt Ratio is expected to grow to 0.86, whereas Short and Long Term Debt Total is forecasted to decline to about 469.3 K. At present, KWESST Micro's EV To Sales is projected to decrease significantly based on the last few years of reporting. The current year's Payables Turnover is expected to grow to 1.09, whereas Days Sales Outstanding is forecasted to decline to 0.81.
At this time, it appears that KWESST Micro Systems is an unlikely manipulator. The earnings manipulation may begin if KWESST Micro'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 KWESST Micro 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 KWESST Micro'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.
-2.52
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables

1.2

Focus
Asset Quality

-0.0947

Focus
Expense Coverage

0.9

Focus
Gross Margin Strengs

0.5

Focus
Accruals Factor

0.9

Focus
Depreciation Resistance

0.78

Focus
Net Sales Growth

0.79

Focus
Financial Leverage Condition

2.23

Focus

KWESST Micro 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 KWESST Micro'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 Receivables63 K66.4 K
Notably Down
Very volatile
Total Revenue1.1 M1.4 M
Significantly Down
Slightly volatile
Total Assets7.3 M13.5 M
Way Down
Slightly volatile
Total Current Assets8.3 M7.9 M
Sufficiently Up
Slightly volatile
Non Current Assets Total4.6 M5.7 M
Significantly Down
Slightly volatile
Property Plant Equipment724.4 K1.2 M
Way Down
Slightly volatile
Depreciation And Amortization1.2 M1.1 M
Sufficiently Up
Slightly volatile
Selling General Administrative5.9 M8.3 M
Way Down
Slightly volatile
Total Current Liabilities7.7 M7.3 M
Sufficiently Up
Slightly volatile
Non Current Liabilities Total1.3 M1.7 M
Way Down
Slightly volatile
Short Term Debt138.9 K146.2 K
Notably Down
Pretty Stable
Long Term Debt72.6 K90.6 K
Significantly Down
Slightly volatile
Short Term Investments1.2 M1.2 M
Sufficiently Up
Slightly volatile

KWESST Micro 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 KWESST Micro's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards KWESST Micro in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find KWESST Micro's degree of accounting gimmicks and manipulations.

About KWESST Micro 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.

Other Operating Expenses

8.25 Million

At present, KWESST Micro's Other Operating Expenses is projected to increase significantly based on the last few years of reporting.

KWESST Micro 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 KWESST Micro. 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 Receivables209.2K699.3K171.9K73.7K66.4K63.0K
Total Current Assets4.0M4.1M1.5M6.8M7.9M8.3M

About KWESST Micro Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze KWESST Micro Systems's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of KWESST Micro using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of KWESST Micro 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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When determining whether KWESST Micro Systems is a strong investment it is important to analyze KWESST Micro's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact KWESST Micro's future performance. For an informed investment choice regarding KWESST Stock, refer to the following important reports:
Check out KWESST Micro Piotroski F Score and KWESST Micro Altman Z Score analysis.
You can also try the Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Is Industrial Machinery & Supplies & Components space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of KWESST Micro. If investors know KWESST will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about KWESST Micro listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Earnings Share
(7.12)
Revenue Per Share
2.384
Quarterly Revenue Growth
1.193
Return On Assets
(0.78)
Return On Equity
(2.22)
The market value of KWESST Micro Systems is measured differently than its book value, which is the value of KWESST that is recorded on the company's balance sheet. Investors also form their own opinion of KWESST Micro's value that differs from its market value or its book value, called intrinsic value, which is KWESST Micro's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because KWESST Micro's market value can be influenced by many factors that don't directly affect KWESST Micro's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between KWESST Micro's value and its price as these two are different measures arrived at by different means. Investors typically determine if KWESST Micro is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, KWESST Micro's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.