Sitio Royalties Corp Stock Beneish M Score

STR Stock  USD 23.70  0.08  0.34%   
This module uses fundamental data of Sitio Royalties to approximate the value of its Beneish M Score. Sitio Royalties 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 Sitio Royalties Piotroski F Score and Sitio Royalties Altman Z Score analysis.
  
At this time, Sitio Royalties' Long Term Debt Total is relatively stable compared to the past year. As of 11/30/2024, Long Term Debt is likely to grow to about 908.6 M, while Net Debt is likely to drop slightly above 536 M. At this time, Sitio Royalties' Net Debt To EBITDA is relatively stable compared to the past year. As of 11/30/2024, Tangible Book Value Per Share is likely to grow to 46.45, while Dividend Yield is likely to drop 0.08.
At this time, it appears that Sitio Royalties Corp is a possible manipulator. The earnings manipulation may begin if Sitio Royalties' 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 Sitio Royalties 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 Sitio Royalties' 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.
-0.26
Beneish M Score - Possible Manipulator
Elasticity of Receivables

0.72

Focus
Asset Quality

7.62

Focus
Expense Coverage

0.84

Focus
Gross Margin Strengs

0.81

Focus
Accruals Factor

0.84

Focus
Depreciation Resistance

1.84

Focus
Net Sales Growth

1.63

Focus
Financial Leverage Condition

1.24

Focus

Sitio Royalties 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 Sitio Royalties' 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 Receivables125.7 M107.3 M
Fairly Up
Pretty Stable
Total Revenue967.3 M593.4 M
Way Up
Slightly volatile
Non Current Assets Total4.8 B4.6 B
Sufficiently Up
Very volatile
Property Plant EquipmentB5.7 B
Sufficiently Up
Slightly volatile
Depreciation And Amortization162.9 M291.3 M
Way Down
Slightly volatile
Selling General Administrative68.1 M49.6 M
Significantly Up
Slightly volatile
Total Current Liabilities30.2 M31.8 M
Notably Down
Slightly volatile
Non Current Liabilities Total694.4 M1.1 B
Way Down
Pretty Stable
Net Debt536 M857.3 M
Way Down
Pretty Stable
Long Term Debt908.6 M865.3 M
Sufficiently Up
Slightly volatile
Total Cash From Operating Activities394 M487.5 M
Significantly Down
Slightly volatile
Short Term Investments12.1 M12.7 M
Notably Down
Slightly volatile
Gross Profit Margin0.580.7133
Significantly Down
Slightly volatile

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

About Sitio Royalties 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.

Other Operating Expenses

940.11 Million

At this time, Sitio Royalties' Other Operating Expenses is relatively stable compared to the past year.

Sitio Royalties 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 Sitio Royalties. 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 Receivables7.9M5.4M36.2M142.0M107.3M125.7M
Total Revenue68.5M45.7M120.6M369.6M593.4M967.3M
Total Assets290.3M275.7M1.2B5.2B4.8B2.4B
Total Current Assets11.6M8.9M48.8M192.2M154.0M278.2M
Net Debt40.0M37.1M121.6M926.9M857.3M536.0M
Long Term Debt42.5M39.8M40M938.9M865.3M908.6M
Operating Income37.2M(3.2M)49.9M194.0M35.4M33.6M
Investments(23.4M)(2.4M)(1.3M)(558.1M)(160.6M)(168.6M)
Gross Profit Margin0.750.30.660.720.710.58

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

About Sitio Royalties Fundamental Analysis

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

Pair Trading with Sitio Royalties

One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Sitio Royalties position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Sitio Royalties will appreciate offsetting losses from the drop in the long position's value.

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The ability to find closely correlated positions to Sitio Royalties could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Sitio Royalties when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Sitio Royalties - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Sitio Royalties Corp to buy it.
The correlation of Sitio Royalties is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Sitio Royalties moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Sitio Royalties Corp moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Sitio Royalties can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Pair CorrelationCorrelation Matching

Additional Tools for Sitio Stock Analysis

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