Micro Beneish M Score

MFGP
 Stock
  

USD 3.17  0.02  0.63%   

This module uses fundamental data of Micro Focus to approximate the value of its Beneish M Score. Micro Focus 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. Additionally, see Micro Focus Piotroski F Score and Micro Focus Altman Z Score analysis.
  
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As of 7th of July 2022, Total Debt is likely to drop to about 5.2 B. In addition to that, Debt Current is likely to drop to about 128.2 M. Micro Focus Revenue to Assets are very stable at the moment as compared to the past year. Micro Focus reported last year Revenue to Assets of 0.32. As of 7th of July 2022, Net Current Assets as percentage of Total Assets is likely to grow to 0.43, while PPandE Turnover is likely to drop 37.98.
At this time, it appears that Micro Focus Intl is an unlikely manipulator. The earnings manipulation may begin if Micro Focus' 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 Micro Focus 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 Micro Focus' 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.
-3.07
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables0.98Focus
Asset Quality1.02Focus
Expense Coverage1.09Focus
Gross Margin Strengs1.02Focus
Accruals Factor1.09Focus
Depreciation ResistanceN/AFocus
Net Sales Growth0.95Focus
Financial Leverage Condition0.94Focus

Micro Focus 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 Micro Focus' 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
Revenues3.2 B3.3 B
Sufficiently Down
Increasing
Slightly volatile
Selling General and Administrative Expense2.2 B2.1 B
Sufficiently Up
Increasing
Slightly volatile
Net Cash Flow from Operations863.8 M794.1 M
Significantly Up
Increasing
Slightly volatile
Total Assets12.1 B11.9 B
Fairly Up
Increasing
Slightly volatile
Investments10.3 M10.3 M
Slightly Down
Decreasing
Slightly volatile
Investments Non Current10.3 M10.3 M
Slightly Down
Decreasing
Slightly volatile
Property Plant and Equipment Net241.3 M262.9 M
Significantly Down
Increasing
Slightly volatile
Trade and Non Trade Receivables976.7 MB
Notably Down
Increasing
Slightly volatile
Total Liabilities8.4 B8.7 B
Sufficiently Down
Increasing
Slightly volatile
Current Assets1.6 B1.8 B
Significantly Down
Increasing
Slightly volatile
Assets Non Current10.4 B10.1 B
Fairly Up
Increasing
Slightly volatile
Current LiabilitiesB2.1 B
Sufficiently Down
Increasing
Slightly volatile
Liabilities Non Current6.4 B6.6 B
Sufficiently Down
Increasing
Slightly volatile
Total Debt5.2 B5.5 B
Notably Down
Increasing
Slightly volatile
Debt Current128.2 M155.1 M
Significantly Down
Increasing
Slightly volatile
Debt Non Current5.1 B5.3 B
Notably Down
Increasing
Slightly volatile
Operating Income(257.9 M)(239 M)
Significantly Down
Decreasing
Slightly volatile
Gross Margin0.670.66
Fairly Up
Decreasing
Slightly volatile

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

About Micro Focus 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.

Earnings Before Interest Taxes and Depreciation Amortization EBITDA

(247.52 Million)

Micro Focus Earnings Before Interest Taxes and Depreciation Amortization EBITDA are very stable at the moment as compared to the past year. Micro Focus reported last year Earnings Before Interest Taxes and Depreciation Amortization EBITDA of (229.41 Million)

About Micro Focus Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Micro Focus Intl's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Micro Focus using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Micro Focus Intl 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.
Micro Focus International plc operates in the enterprise software business in the United Kingdom, the United States, Germany, Canada, France, Japan, and internationally. The company was founded in 1976 and is headquartered in Newbury, the United Kingdom. Micro Focus operates under SoftwareInfrastructure classification in the United States and is traded on New York Stock Exchange. It employs 11355 people.

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Additionally, see Micro Focus Piotroski F Score and Micro Focus Altman Z Score analysis. Note that the Micro Focus Intl information on this page should be used as a complementary analysis to other Micro Focus' 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 Companies Directory module to evaluate performance of over 100,000 Stocks, Funds, and ETFs against different fundamentals.

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When running Micro Focus Intl price analysis, check to measure Micro Focus' 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 Micro Focus is operating at the current time. Most of Micro Focus' value examination focuses on studying past and present price action to predict the probability of Micro Focus' future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Micro Focus' price. Additionally, you may evaluate how the addition of Micro Focus to your portfolios can decrease your overall portfolio volatility.
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Is Micro Focus' 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 Micro Focus. If investors know Micro 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 Micro Focus 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
1.45
Market Capitalization
1.1 B
Quarterly Revenue Growth YOY
-0.11
Return On Assets
-9.0E-4
Return On Equity
-0.0855
The market value of Micro Focus Intl is measured differently than its book value, which is the value of Micro that is recorded on the company's balance sheet. Investors also form their own opinion of Micro Focus' value that differs from its market value or its book value, called intrinsic value, which is Micro Focus' 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 Micro Focus' market value can be influenced by many factors that don't directly affect Micro Focus' 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 Micro Focus' value and its price as these two are different measures arrived at by different means. Investors typically determine Micro Focus value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Micro Focus' 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.