Verano Holdings (Verano Holdings) Beneish M-Score : -1.78 (As of Apr. 24, 2024)

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

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

VRNOF' s Beneish M-Score Range Over the Past 10 Years
Min: -2.99 Med: -2.39 Max: -1.78
Current: -1.78

During the past 5 years, the highest Beneish M-Score of Verano Holdings was -1.78. The lowest was -2.99. And the median was -2.39.

Verano Holdings Beneish M-Score Historical Data

The historical data trend for Verano Holdings'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.

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Verano Holdings Beneish M-Score Chart

Verano Holdings Annual Data

Trend

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

-2.99

-1.78

Verano Holdings 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															-2.99	-2.73	-1.86	-1.75	-1.78

Competitive Comparison of Verano Holdings's Beneish M-Score

For the Drug Manufacturers - Specialty & Generic subindustry, Verano Holdings'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.

Verano Holdings's Beneish M-Score Distribution in the Drug Manufacturers Industry

For the Drug Manufacturers industry and Healthcare sector, Verano Holdings's Beneish M-Score distribution charts can be found below:

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

Verano Holdings 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 Verano Holdings 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 * 2.2031

0.528 * 0.95

0.404 * 0.935

0.892 * 1.0671

0.115 * 0.9756

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.8723

4.679 * -0.073905

0.327 * 1.0833

-1.72

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was $39.0 Mil.
Revenue was 237.189 + 240.088 + 234.115 + 227.06 = $938.5 Mil.
Gross Profit was 117.611 + 133.22 + 115.191 + 109.185 = $475.2 Mil.
Total Current Assets was $394.2 Mil.
Total Assets was $2,318.7 Mil.
Property, Plant and Equipment(Net PPE) was $594.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $151.6 Mil.
Selling, General, & Admin. Expense(SGA) was $331.9 Mil.
Total Current Liabilities was $412.2 Mil.
Long-Term Debt & Capital Lease Obligation was $481.0 Mil.
Net Income was -77.208 + -17.842 + -13.061 + -9.237 = $-117.3 Mil.
Non Operating Income was -50.134 + -4.705 + -1.9 + 1.047 = $-55.7 Mil.
Cash Flow from Operations was 32.349 + 36.621 + 23.878 + 16.862 = $109.7 Mil.

Total Receivables was $16.6 Mil.
Revenue was 225.927 + 227.588 + 223.662 + 202.235 = $879.4 Mil.
Gross Profit was 103.336 + 122.994 + 98.115 + 98.617 = $423.1 Mil.
Total Current Assets was $318.3 Mil.
Total Assets was $2,396.1 Mil.
Property, Plant and Equipment(Net PPE) was $608.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $150.3 Mil.
Selling, General, & Admin. Expense(SGA) was $356.6 Mil.
Total Current Liabilities was $386.6 Mil.
Long-Term Debt & Capital Lease Obligation was $465.4 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)
	=	(38.981 / 938.452)	/	(16.58 / 879.412)
	=	0.041538	/	0.018854
	=	2.2031

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)
	=	(423.062 / 879.412)	/	(475.207 / 938.452)
	=	0.481074	/	0.506373
	=	0.95

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 - (394.196 + 594.763) / 2318.745)	/	(1 - (318.275 + 608.183) / 2396.055)
	=	0.573494	/	0.61334
	=	0.935

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
	=	938.452	/	879.412
	=	1.0671

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))
	=	(150.325 / (150.325 + 608.183))	/	(151.626 / (151.626 + 594.763))
	=	0.198185	/	0.203146
	=	0.9756

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)
	=	(331.923 / 938.452)	/	(356.571 / 879.412)
	=	0.353692	/	0.405465
	=	0.8723

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)
	=	((481.034 + 412.188) / 2318.745)	/	((465.393 + 386.645) / 2396.055)
	=	0.385218	/	0.3556
	=	1.0833

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
	=	(-117.348 - -55.692	-	109.71)	/	2318.745
	=	-0.073905

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.

Verano Holdings has a M-score of -1.72 signals that the company is likely to be a manipulator.

Verano Holdings Beneish M-Score Related Terms

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Verano Holdings (Verano Holdings) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Drug Manufacturers » Verano Holdings Corp (OTCPK:VRNOF) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

VRNO:Canada

Address

415 North Dearborn Street, 4th Floor, Chicago, IL, USA, 60654

Website

https://www.veranogrown.com

Verano Holdings Corp is a vertically integrated multi?state cannabis operator in the United States. The company derives its revenues from its wholesale business and its retail dispensary chains. The retail business includes the design, build-out and operation of branded dispensaries in both medical and adult-use markets. The company's consumer brands include Encore, Avexia, MÜV, Savvy, BITS and Verano. The company's retail dispensaries operate under brands including Zen Leaf and MÜV.