Despegar.com (Despegar.com) Beneish M-Score : -2.19 (As of Apr. 29, 2024)

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What is Despegar.com Beneish M-Score?

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 -2.19 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

DESP' s Beneish M-Score Range Over the Past 10 Years
Min: -3.77 Med: -2.19 Max: 1.78
Current: -2.19

During the past 9 years, the highest Beneish M-Score of Despegar.com was 1.78. The lowest was -3.77. And the median was -2.19.

Despegar.com Beneish M-Score Historical Data

The historical data trend for Despegar.com's Beneish M-Score can be seen below:

* 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.

* Premium members only.

Despegar.com Beneish M-Score Chart

Despegar.com Annual Data

Trend

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.74

-1.12

-2.20

-2.75

Despegar.com Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Beneish M-Score	Get a 7-Day Free Trial															-2.75	-2.27	-2.16	-2.19	-

Competitive Comparison of Despegar.com's Beneish M-Score

For the Travel Services subindustry, Despegar.com's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Despegar.com's Beneish M-Score Distribution in the Travel & Leisure Industry

For the Travel & Leisure industry and Consumer Cyclical sector, Despegar.com's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Despegar.com's Beneish M-Score falls into.

Despegar.com 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 Despegar.com 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 * 0.9863

0.528 * 0.9767

0.404 * 0.9595

0.892 * 1.3124

0.115 * 0.9788

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.8518

4.679 * -0.074929

0.327 * 1.0532

-2.59

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was $259.0 Mil.
Revenue was 203.66 + 178.149 + 165.524 + 158.707 = $706.0 Mil.
Gross Profit was 143.348 + 120.55 + 105.524 + 107.68 = $477.1 Mil.
Total Current Assets was $537.3 Mil.
Total Assets was $898.3 Mil.
Property, Plant and Equipment(Net PPE) was $38.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $43.4 Mil.
Selling, General, & Admin. Expense(SGA) was $298.1 Mil.
Total Current Liabilities was $671.1 Mil.
Long-Term Debt & Capital Lease Obligation was $19.2 Mil.
Net Income was -2.501 + -0.315 + 28.003 + -0.697 = $24.5 Mil.
Non Operating Income was -9.809 + -0.948 + -0.285 + 0.113 = $-10.9 Mil.
Cash Flow from Operations was 34.921 + 33.757 + 28.873 + 5.179 = $102.7 Mil.

Total Receivables was $200.1 Mil.
Revenue was 145.541 + 145.596 + 134.421 + 112.414 = $538.0 Mil.
Gross Profit was 100.655 + 95.291 + 89.272 + 69.856 = $355.1 Mil.
Total Current Assets was $465.1 Mil.
Total Assets was $804.2 Mil.
Property, Plant and Equipment(Net PPE) was $38.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $41.1 Mil.
Selling, General, & Admin. Expense(SGA) was $266.7 Mil.
Total Current Liabilities was $564.5 Mil.
Long-Term Debt & Capital Lease Obligation was $22.3 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)
	=	(259.032 / 706.04)	/	(200.119 / 537.972)
	=	0.36688	/	0.371988
	=	0.9863

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)
	=	(355.074 / 537.972)	/	(477.102 / 706.04)
	=	0.660023	/	0.675744
	=	0.9767

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 - (537.252 + 38.35) / 898.334)	/	(1 - (465.126 + 37.96) / 804.192)
	=	0.359256	/	0.374421
	=	0.9595

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
	=	706.04	/	537.972
	=	1.3124

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))
	=	(41.098 / (41.098 + 37.96))	/	(43.44 / (43.44 + 38.35))
	=	0.519846	/	0.531116
	=	0.9788

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)
	=	(298.127 / 706.04)	/	(266.671 / 537.972)
	=	0.422252	/	0.495697
	=	0.8518

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)
	=	((19.232 + 671.079) / 898.334)	/	((22.27 + 564.485) / 804.192)
	=	0.768435	/	0.729621
	=	1.0532

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
	=	(24.49 - -10.929	-	102.73)	/	898.334
	=	-0.074929

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.

Despegar.com has a M-score of -2.59 suggests that the company is unlikely to be a manipulator.

Despegar.com Beneish M-Score Related Terms

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Despegar.com (Despegar.com) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Travel & Leisure » Despegar.com Corp (NYSE:DESP) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

D3G:Germany DESP:Argentina

Address

Juana Manso 1069, Floor 5, Buenos Aires, ARG, C1107CBU

Website

https://www.despegar.com

Despegar.com Corp is an online travel company in Latin America. Its product offering includes airline tickets, packages, hotels, and other travel-related products, which enables consumers to find, compare, plan and purchase travel products easily through its marketplace. The company provides a technology platform for managing the distribution of products and access to users to the network of travel suppliers. It operates through two segments: Air, which consists of the sale of airline tickets; and Packages, Hotels, and Other Travel Products, which consists of travel packages, as well as sales of hotel rooms, car rentals, bus tickets, cruise tickets, travel insurance and destination services. Its geographical segments are Argentina, Brazil, Uruguay, Mexico, and other countries.