Balchem Beneish M Score

BCPC
 Stock
  

USD 134.17  4.69  3.62%   

This module uses fundamental data of Balchem Cp to approximate the value of its Beneish M Score. Balchem Cp 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. Continue to Balchem Cp Piotroski F Score and Balchem Cp Altman Z Score analysis.
  
Balchem Cp Total Debt is projected to increase significantly based on the last few years of reporting. The past year's Total Debt was at 118.04 Million. The current year Debt Current is expected to grow to about 2.4 M, whereas Issuance Repayment of Debt Securities is forecasted to decline to (56.6 M). Balchem Cp Interest Coverage is projected to increase significantly based on the last few years of reporting. The past year's Interest Coverage was at 51.91. The current year Long Term Debt to Equity is expected to grow to 0.13, whereas Cash and Equivalents Turnover is forecasted to decline to 7.64.
At this time, it appears that Balchem Cp is an unlikely manipulator. The earnings manipulation may begin if Balchem Cp'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 Balchem Cp 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 Balchem Cp'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.
-3.09
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables0.98Focus
Asset QualityN/AFocus
Expense Coverage1.0Focus
Gross Margin Strengs1.09Focus
Accruals Factor1.0Focus
Depreciation Resistance0.96Focus
Net Sales Growth0.92Focus
Financial Leverage Condition1.18Focus

Balchem Cp 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 Balchem Cp'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
Revenues734.8 M799 M
Significantly Down
Increasing
Slightly volatile
Selling General and Administrative Expense93.8 M102.1 M
Significantly Down
Increasing
Slightly volatile
Net Cash Flow from Operations143.2 M160.5 M
Fairly Down
Increasing
Slightly volatile
Depreciation Amortization and Accretion45.8 M48.9 M
Notably Down
Increasing
Slightly volatile
Total Assets1.1 B1.2 B
Significantly Down
Increasing
Slightly volatile
Property Plant and Equipment Net219.2 M246.8 M
Fairly Down
Increasing
Slightly volatile
Trade and Non Trade Receivables105.6 M117.4 M
Moderately Down
Increasing
Slightly volatile
Total Liabilities335.2 M322.3 M
Sufficiently Up
Increasing
Slightly volatile
Current Assets301.3 M322.2 M
Notably Down
Increasing
Slightly volatile
Assets Non Current809.7 M877.1 M
Significantly Down
Increasing
Slightly volatile
Current Liabilities122.8 M143.8 M
Fairly Down
Increasing
Slightly volatile
Liabilities Non Current212.4 M178.5 M
Fairly Up
Increasing
Slightly volatile
Total Debt147.8 M118 M
Significantly Up
Increasing
Very volatile
Debt Current2.4 M2.4 M
Fairly Up
Decreasing
Slightly volatile
Debt Non Current139.6 M115.7 M
Fairly Up
Increasing
Very volatile
Operating Income119.4 M127.5 M
Notably Down
Increasing
Slightly volatile
Gross Margin0.330.304
Significantly Up
Increasing
Slightly volatile

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

About Balchem Cp 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 Amortization and Accretion

45.79 Million

Balchem Cp Depreciation Amortization and Accretion is projected to increase significantly based on the last few years of reporting. The past year's Depreciation Amortization and Accretion was at 48.88 Million

Balchem Cp 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 Balchem Cp. 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.
201720182019202020212022 (projected)
Revenues594.79 M643.68 M643.71 M703.64 M799.02 M734.82 M
Total Assets963.64 M981.36 M1.16 B1.17 B1.2 B1.11 B
Current Assets199.34 M226.31 M254.95 M266.89 M322.23 M301.34 M
Assets Non Current764.3 M755.04 M900.74 M898.96 M877.09 M809.71 M
Total Liabilities346.75 M289.74 M412.01 M337.61 M322.31 M335.24 M
Current Liabilities108.4 M82.06 M92.26 M94.43 M143.8 M122.82 M
Total Debt218.96 M156 M255.87 M171.99 M118.04 M147.8 M
Debt Non Current183.96 M156 M253.4 M169.65 M115.68 M139.61 M
Operating Income96.9 M107.1 M102.55 M111.15 M127.5 M119.41 M

About Balchem Cp Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Balchem Cp's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Balchem Cp using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Balchem Cp 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.
Balchem Corporation develops, manufactures, and markets specialty performance ingredients and products for the nutritional, food, pharmaceutical, animal health, medical device sterilization, plant nutrition, and industrial markets in the United States and internationally. Balchem Corporation was incorporated in 1967 and is headquartered in New Hampton, New York. Balchem Cp operates under Specialty Chemicals classification in the United States and is traded on NASDAQ Exchange. It employs 1359 people.

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Our tools can tell you how much better you can do entering a position in Balchem Cp without increasing your portfolio risk or giving up expected return. As an individual investor, you need to find a reliable way to track all your investment portfolios. However, your requirements will often be based on how much of the process you decide to do yourself. In addition to allowing all investors analytical transparency into all their portfolios, our tools can evaluate.risk-adjusted returns of your individual positions relative to your overall portfolio.

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Pair Trading with Balchem Cp

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Balchem Cp position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Balchem Cp will appreciate offsetting losses from the drop in the long position's value.
The ability to find closely correlated positions to Balchem Cp could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Balchem Cp when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Balchem Cp - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Balchem Cp to buy it.
The correlation of Balchem Cp is a statistical measure of how it moves in relation to other equities. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Balchem Cp moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Balchem Cp moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Balchem Cp can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching
Continue to Balchem Cp Piotroski F Score and Balchem Cp Altman Z Score analysis. Note that the Balchem Cp information on this page should be used as a complementary analysis to other Balchem Cp's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Risk-Return Analysis module to view associations between returns expected from investment and the risk you assume.

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Is Balchem Cp's industry 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 Balchem Cp. If investors know Balchem 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 Balchem Cp listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth YOY
0.31
Market Capitalization
4.2 B
Quarterly Revenue Growth YOY
0.17
Return On Assets
0.0652
Return On Equity
0.12
The market value of Balchem Cp is measured differently than its book value, which is the value of Balchem that is recorded on the company's balance sheet. Investors also form their own opinion of Balchem Cp's value that differs from its market value or its book value, called intrinsic value, which is Balchem Cp'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 Balchem Cp's market value can be influenced by many factors that don't directly affect Balchem Cp'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 Balchem Cp's value and its price as these two are different measures arrived at by different means. Investors typically determine Balchem Cp value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Balchem Cp'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.