Bancorp 34 (Bancorp 34) Beneish M-Score : -2.38 (As of Apr. 27, 2024)

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What is Bancorp 34 Beneish M-Score?

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.38 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Bancorp 34's Beneish M-Score or its related term are showing as below:

BCTF' s Beneish M-Score Range Over the Past 10 Years
Min: -3 Med: -2.39 Max: -1.52
Current: -2.38

During the past 13 years, the highest Beneish M-Score of Bancorp 34 was -1.52. The lowest was -3.00. And the median was -2.39.

Bancorp 34 Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Bancorp 34 for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 0.9237

0.528 * 1

0.404 * 0.9977

0.892 * 1.2779

0.115 * 1

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.9099

4.679 * -0.008411

0.327 * 1.1494

-2.38

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

This Year (Dec23) TTM:

Last Year (Dec21) TTM:

Total Receivables was $1.60 Mil.
Revenue was 3.711 + 3.868 + 4.215 + 4.706 = $16.50 Mil.
Gross Profit was 3.711 + 3.868 + 4.215 + 4.706 = $16.50 Mil.
Total Current Assets was $85.47 Mil.
Total Assets was $581.27 Mil.
Property, Plant and Equipment(Net PPE) was $9.17 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.00 Mil.
Selling, General, & Admin. Expense(SGA) was $8.32 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt & Capital Lease Obligation was $55.61 Mil.
Net Income was -1.676 + -2.275 + -1.942 + 1.004 = $-4.89 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 0 + 0 + 0 + 0 = $0.00 Mil.

Total Receivables was $1.35 Mil.
Revenue was 0 + 4.655 + 4.283 + 3.974 = $12.91 Mil.
Gross Profit was 0 + 4.655 + 4.283 + 3.974 = $12.91 Mil.
Total Current Assets was $76.50 Mil.
Total Assets was $527.65 Mil.
Property, Plant and Equipment(Net PPE) was $8.39 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.15 Mil.
Selling, General, & Admin. Expense(SGA) was $7.16 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt & Capital Lease Obligation was $43.92 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total Receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI	=	(Receivables_t / Revenue_t)	/	(Receivables_t-1 / Revenue_t-1)
	=	(1.597 / 16.5)	/	(1.353 / 12.912)
	=	0.096788	/	0.104786
	=	0.9237

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI	=	GrossMargin_t-1	/	GrossMargin_t
	=	(GrossProfit_t-1 / Revenue_t-1)	/	(GrossProfit_t / Revenue_t)
	=	(12.912 / 12.912)	/	(16.5 / 16.5)
	=	1	/	1
	=	1

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (85.469 + 9.169) / 581.265)	/	(1 - (76.5 + 8.392) / 527.652)
	=	0.837186	/	0.839114
	=	0.9977

4. SGI = Sales Growth Index

Ratio of Revenue in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI	=	Sales_t	/	Sales_t-1
	=	Revenue_t	/	Revenue_t-1
	=	16.5	/	12.912
	=	1.2779

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI	=	(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1))	/	(Depreciation_t / (Depreciaton_t + PPE_t))
	=	(0.145 / (0.145 + 8.392))	/	(0 / (0 + 9.169))
	=	0.016985	/	0
	=	1

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI	=	(SGA_t / Sales_t)	/	(SGA_t-1 /Sales_t-1)
	=	(8.321 / 16.5)	/	(7.156 / 12.912)
	=	0.504303	/	0.554213
	=	0.9099

7. LVGI = Leverage Index

The ratio of total debt to Total Assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((55.606 + 0) / 581.265)	/	((43.915 + 0) / 527.652)
	=	0.095664	/	0.083227
	=	1.1494

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA	=	(IncomefromContinuingOperations_t	-	CashFlowsfromOperations_t)	/	TotalAssets_t
	=	(NetIncome_t - NonOperatingIncome_t	-	CashFlowsfromOperations_t)	/	TotalAssets_t
	=	(-4.889 - 0	-	0)	/	581.265
	=	-0.008411

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Bancorp 34 has a M-score of -2.38 suggests that the company is unlikely to be a manipulator.

Bancorp 34 Beneish M-Score Related Terms

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Bancorp 34 (Bancorp 34) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » Bancorp 34 Inc (OTCPK:BCTF) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

N/A

Address

500 East 10th Street, Suite 100, Alamogordo, NM, USA, 88310

Website

https://www.bank34.com

Bancorp 34 Inc provides a variety of banking services to individuals and businesses through its branches. Its products and services are demand deposits, certificates of deposits, savings and money market accounts, commercial loans, real estate mortgage loans and credit and merchant cards and e-banking. The bank operates banking centers in Alamogordo, Las Cruces, New Mexico, Scottsdale, Arizona, and Peoria.

Executives

James Crotty	officer: Co-President and CEO	500 EAST 10TH STREET, SUITE 100, ALAMOGORDO NM 88310
Elaine E. Ralls	director	500 EAST 10TH STREET, ALAMOGORDO NM 88310
Van Winkle Don P.	director	500 EAST 10TH STREET, ALAMOGORDO NM 88310
Wortham A. Cook	director	500 EAST 10TH STREET, ALAMOGORDO NM 88310
James D. Harris	director	500 EAST 10TH STREET, ALAMOGORDO NM 88310
Randal L. Rabon	director	500 EAST 10TH STREET, ALAMOGORDO NM 88310
William P. Kauper	officer: President/Dir Corp Development	500 EAST 10TH STREET, ALAMOGORDO NM 88310
Jan R Thiry	officer: President and CEO	500 EAST 10TH STREET, ALAMOGORDO NM 88310
Jill Gutierrez	director, officer: CEO	500 EAST 10TH STREET, ALAMOGORDO NM 88310
William F. Burt	director	500 EAST 10TH STREET, ALAMOGORDO NM 88310