Nortech Systems Incorporated Stock Beneish M Score

NSYS Stock  USD 11.60  1.21  11.65%   
This module uses fundamental data of Nortech Systems to approximate the value of its Beneish M Score. Nortech Systems 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. Check out Nortech Systems Piotroski F Score and Nortech Systems Altman Z Score analysis.
  
At this time, Nortech Systems' Short Term Debt is comparatively stable compared to the past year. Long Term Debt is likely to gain to about 8 M in 2024, whereas Net Debt is likely to drop slightly above 12.5 M in 2024. At this time, Nortech Systems' Net Income Per Share is comparatively stable compared to the past year. Days Of Inventory On Hand is likely to gain to 85.03 in 2024, whereas Free Cash Flow Yield is likely to drop 0.02 in 2024.
At this time, Nortech Systems' M Score is unavailable. The earnings manipulation may begin if Nortech Systems' 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 Nortech Systems 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 Nortech Systems' 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.
-1.27
Beneish M Score - Unavailable
Elasticity of Receivables

1.58

Focus
Asset Quality

2.49

Focus
Expense Coverage

1.04

Focus
Gross Margin Strengs

1.03

Focus
Accruals Factor

1.04

Focus
Depreciation Resistance

0.77

Focus
Net Sales Growth

0.66

Focus
Financial Leverage Condition

1.22

Focus

Nortech Systems 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 Nortech Systems' 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
Net Receivables35.4 M33.8 M
Sufficiently Up
Slightly volatile
Total Revenue92.6 M139.3 M
Way Down
Slightly volatile
Total Assets45.4 M75.1 M
Way Down
Slightly volatile
Total Current Assets34 M58.8 M
Way Down
Slightly volatile
Non Current Assets Total11.3 M16.3 M
Way Down
Slightly volatile
Property Plant Equipment10.4 M16.4 M
Way Down
Slightly volatile
Depreciation And Amortization1.8 MM
Fairly Down
Slightly volatile
Selling General Administrative8.5 M12.4 M
Way Down
Slightly volatile
Total Current Liabilities16.7 M26.6 M
Way Down
Slightly volatile
Non Current Liabilities Total10 M13.2 M
Way Down
Slightly volatile
Net Debt12.5 M13.2 M
Notably Down
Slightly volatile
Short Term Debt3.8 M2.8 M
Significantly Up
Slightly volatile
Long Term DebtM5.8 M
Significantly Up
Pretty Stable
Gross Profit Margin0.170.1658
Fairly Up
Very volatile

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

About Nortech Systems 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 And Amortization

1.75 Million

At this time, Nortech Systems' Depreciation And Amortization is comparatively stable compared to the past year.

Nortech Systems 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 Nortech Systems. 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.
201920202021202220232024 (projected)
Net Receivables26.2M21.5M28.5M28.6M33.8M35.4M
Total Revenue116.3M104.1M115.2M134.1M139.3M92.6M
Total Assets61.4M57.6M67.1M69.5M75.1M45.4M
Total Current Assets43.3M41.0M51.8M54.9M58.8M34.0M
Net Debt20.3M21.4M19.6M17.0M13.2M12.5M
Short Term Debt1.4M2.6M3.3M3.1M2.8M3.8M
Long Term Debt13.3M9.2M9.0M6.9M5.8M8.0M
Operating Income(2.0M)(2.1M)2.3M2.0M6.0M6.3M
Investments(758K)5.5M(730K)(2.4M)(1.8M)(1.7M)

Nortech Systems 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, Nortech Systems' sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Nortech Systems' managers, analysts, and investors.
Environmental
Governance
Social

About Nortech Systems Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Nortech Systems Incorporated's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Nortech Systems using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Nortech Systems Incorporated 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.

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Additional Tools for Nortech Stock Analysis

When running Nortech Systems' price analysis, check to measure Nortech Systems' 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 Nortech Systems is operating at the current time. Most of Nortech Systems' value examination focuses on studying past and present price action to predict the probability of Nortech Systems' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Nortech Systems' price. Additionally, you may evaluate how the addition of Nortech Systems to your portfolios can decrease your overall portfolio volatility.