CNH Industrial Beneish M Score

CNHI
 Stock
  

USD 13.05  0.08  0.61%   

This module uses fundamental data of CNH Industrial to approximate the value of its Beneish M Score. CNH Industrial 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 CNH Industrial Piotroski F Score and CNH Industrial Altman Z Score analysis.
  
CNH Industrial Total Debt is most likely to decrease significantly in the upcoming years. The last year's value of Total Debt was reported at 21.69 Billion. The current Debt to Equity Ratio is estimated to increase to 6.24, while Issuance Repayment of Debt Securities is projected to decrease to (1.3 B). CNH Industrial Dividends per Basic Common Share is most likely to slightly decrease in the upcoming years. The last year's value of Dividends per Basic Common Share was reported at 0.13. The current Earnings per Basic Share is estimated to increase to 1.37, while Asset Turnover is projected to decrease to 0.62.
At this time, it appears that CNH Industrial NV is an unlikely manipulator. The earnings manipulation may begin if CNH Industrial'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 CNH Industrial 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 CNH Industrial'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.
-3.27
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables1.14Focus
Asset Quality-0.61Focus
Expense Coverage1.07Focus
Gross Margin Strengs0.94Focus
Accruals Factor1.07Focus
Depreciation Resistance1.2Focus
Net Sales Growth0.9Focus
Financial Leverage Condition1.05Focus

CNH Industrial 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 CNH Industrial'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
Revenues30.2 B33.4 B
Moderately Down
Decreasing
Slightly volatile
Selling General and Administrative Expense2.4 B2.4 B
Sufficiently Down
Decreasing
Slightly volatile
Net Cash Flow from Operations3.6 B4.1 B
Fairly Down
Increasing
Slightly volatile
Depreciation Amortization and Accretion1.3 B1.1 B
Moderately Up
Increasing
Slightly volatile
Total Assets47.7 B51.1 B
Significantly Down
Decreasing
Slightly volatile
Investments16.8 B15.9 B
Notably Up
Decreasing
Slightly volatile
Investments Current17 B16.4 B
Sufficiently Up
Decreasing
Slightly volatile
Investments Non Current55.1 M57 M
Sufficiently Down
Decreasing
Slightly volatile
Property Plant and Equipment Net4.9 B3.4 B
Significantly Up
Decreasing
Slightly volatile
Trade and Non Trade Receivables197.1 M192 M
Fairly Up
Decreasing
Slightly volatile
Total Liabilities40.9 B42.7 B
Sufficiently Down
Decreasing
Slightly volatile
Current Assets28.9 B26.8 B
Significantly Up
Decreasing
Slightly volatile
Assets Non Current22.2 B24.3 B
Significantly Down
Increasing
Slightly volatile
Total Debt22.5 B21.7 B
Sufficiently Up
Decreasing
Slightly volatile
Operating Income2.2 B2.6 B
Fairly Down
Decreasing
Slightly volatile
Gross Margin0.210.224
Notably Down
Decreasing
Stable

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

About CNH Industrial 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

1.28 Billion

CNH Industrial Depreciation Amortization and Accretion is most likely to increase significantly in the upcoming years. The last year's value of Depreciation Amortization and Accretion was reported at 1.15 Billion

CNH Industrial 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 CNH Industrial. 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)
Trade and Non Trade Receivables496 M395 M416 M506 M192 M197.05 M
Revenues27.7 B29.71 B28.08 B26.03 B33.43 B30.17 B
Total Assets48.3 B48.65 B47.35 B48.72 B51.12 B47.73 B
Property Plant and Equipment Net8.68 B7.74 B7.13 B6.9 B3.44 B4.89 B
Depreciation Amortization and Accretion1.35 B1.34 B1.22 B1.17 B1.15 B1.28 B
Selling General and Administrative Expense2.31 B2.35 B2.22 B2.15 B2.44 B2.37 B
Total Liabilities44.04 B41.18 B41.2 B43.69 B42.7 B40.89 B
Total Debt25.89 B24.65 B24.85 B26.05 B21.69 B22.48 B
Operating Income1.6 B2.28 B1.97 B173 M2.58 B2.17 B
Net Cash Flow from Operations2.87 B2.55 B1.83 B5.53 B4.08 B3.6 B
Investments20.43 B19.79 B20.13 B19.54 B15.89 B16.79 B

CNH Industrial 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, CNH Industrial's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to CNH Industrial's managers, analysts, and investors.
Environment Score
Governance Score
Social Score

About CNH Industrial Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze CNH Industrial NV's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of CNH Industrial using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of CNH Industrial NV 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.
CNH Industrial N.V. designs, produces, markets, sells, and finances agricultural and construction equipment, trucks, commercial vehicles, buses, and specialty vehicles in North America, Europe, South America, and internationally. The company was founded in 1842 and is headquartered in London, the United Kingdom. CNH Industrial operates under Farm Heavy Construction Machinery classification in the United States and is traded on New York Stock Exchange. It employs 71895 people.

Be your own money manager

Our tools can tell you how much better you can do entering a position in CNH Industrial 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 CNH Industrial

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 CNH Industrial 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 CNH Industrial will appreciate offsetting losses from the drop in the long position's value.

Moving together with CNH Industrial

0.86DEDeere Company Earnings Call  This WeekPairCorr
0.66ABMABM Industries Fiscal Year End 21st of December 2022 PairCorr

Moving against CNH Industrial

0.68ACEVAce Convergence Acqu Earnings Call  This WeekPairCorr
0.55ASAQAtlantic Street Acqu Earnings Call  This WeekPairCorr
The ability to find closely correlated positions to CNH Industrial could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace CNH Industrial 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 CNH Industrial - 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 CNH Industrial NV to buy it.
The correlation of CNH Industrial 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 CNH Industrial moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if CNH Industrial NV 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 CNH Industrial 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 CNH Industrial Piotroski F Score and CNH Industrial Altman Z Score analysis. Note that the CNH Industrial NV information on this page should be used as a complementary analysis to other CNH Industrial'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 Commodity Channel Index module to use Commodity Channel Index to analyze current equity momentum.

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Is CNH Industrial'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 CNH Industrial. If investors know CNH Industrial 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 CNH Industrial 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
-0.21
Market Capitalization
17.8 B
Quarterly Revenue Growth YOY
0.18
Return On Assets
0.0384
Return On Equity
0.3
The market value of CNH Industrial NV is measured differently than its book value, which is the value of CNH Industrial that is recorded on the company's balance sheet. Investors also form their own opinion of CNH Industrial's value that differs from its market value or its book value, called intrinsic value, which is CNH Industrial'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 CNH Industrial's market value can be influenced by many factors that don't directly affect CNH Industrial'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 CNH Industrial's value and its price as these two are different measures arrived at by different means. Investors typically determine CNH Industrial value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, CNH Industrial'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.