Target Hospitality Corp Stock Beneish M Score

TH Stock  USD 9.62  0.08  0.84%   
This module uses fundamental data of Target Hospitality to approximate the value of its Beneish M Score. Target Hospitality 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 Target Hospitality Piotroski F Score and Target Hospitality Altman Z Score analysis.
  
As of now, Target Hospitality's Net Debt is increasing as compared to previous years. The Target Hospitality's current Interest Debt Per Share is estimated to increase to 2.62, while Short and Long Term Debt is projected to decrease to under 2.1 M. As of now, Target Hospitality's EV To Sales is decreasing as compared to previous years. The Target Hospitality's current Free Cash Flow Per Share is estimated to increase to 0.92, while PTB Ratio is projected to decrease to 2.48.
At this time, it appears that Target Hospitality Corp is a possible manipulator. The earnings manipulation may begin if Target Hospitality's 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 Target Hospitality 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 Target Hospitality's 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.
-1.69
Beneish M Score - Possible Manipulator
Elasticity of Receivables

1.06

Focus
Asset Quality

1.97

Focus
Expense Coverage

1.31

Focus
Gross Margin Strengs

0.86

Focus
Accruals Factor

1.31

Focus
Depreciation Resistance

0.93

Focus
Net Sales Growth

0.59

Focus
Financial Leverage Condition

1.86

Focus

Target Hospitality 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 Target Hospitality's 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 Receivables42.2 M67.1 M
Way Down
Slightly volatile
Total Revenue333.8 M563.6 M
Way Down
Slightly volatile
Total Assets597.6 M694.4 M
Fairly Down
Slightly volatile
Total Current Assets113.5 M180.5 M
Way Down
Very volatile
Non Current Assets Total475 M513.9 M
Significantly Down
Slightly volatile
Property Plant Equipment327.7 M447.4 M
Way Down
Slightly volatile
Depreciation And Amortization68.7 M85.6 M
Significantly Down
Slightly volatile
Selling General Administrative43.6 M56.1 M
Significantly Down
Slightly volatile
Total Current Liabilities75.1 M70.3 M
Notably Up
Slightly volatile
Net Debt193 M96.9 M
Way Up
Slightly volatile
Short Term Debt27.9 M26.6 M
Sufficiently Up
Slightly volatile
Long Term Debt272.7 M178.1 M
Way Up
Slightly volatile
Operating Income252.6 M240.6 M
Sufficiently Up
Slightly volatile
Total Cash From Operating Activities108.1 M156.8 M
Way Down
Slightly volatile
Short Term Investments1.6 M1.7 M
Notably Down
Slightly volatile
Gross Profit Margin0.480.5559
Fairly Down
Slightly volatile

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

About Target Hospitality 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.

Current Deferred Revenue

1.7 Million

As of now, Target Hospitality's Current Deferred Revenue is increasing as compared to previous years.

Target Hospitality 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 Target Hospitality. 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 Receivables48.5M28.2M28.8M42.2M67.1M42.2M
Total Revenue321.1M225.1M291.3M502.0M563.6M333.8M
Total Assets600.8M534.2M513.4M771.7M694.4M597.6M
Total Current Assets60.8M43.6M60.5M236.4M180.5M113.5M
Net Debt396.5M367.5M306.8M160.8M96.9M193.0M
Short Term Debt989K3.6M729K27.3M26.6M27.9M
Long Term Debt403.3M374.5M330.2M328.8M178.1M272.7M
Operating Income48.2M4.1M37.1M174.4M240.6M252.6M
Investments(112.7M)(10.9M)(35.9M)(140.2M)(68.2M)(71.6M)
Gross Profit Margin0.460.250.350.490.560.48

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

About Target Hospitality Fundamental Analysis

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

Currently Active Assets on Macroaxis

Is Hotels, Resorts & Cruise Lines space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Target Hospitality. If investors know Target will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Target Hospitality listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.54)
Earnings Share
0.87
Revenue Per Share
4.256
Quarterly Revenue Growth
(0.35)
Return On Assets
0.1237
The market value of Target Hospitality Corp is measured differently than its book value, which is the value of Target that is recorded on the company's balance sheet. Investors also form their own opinion of Target Hospitality's value that differs from its market value or its book value, called intrinsic value, which is Target Hospitality's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Target Hospitality's market value can be influenced by many factors that don't directly affect Target Hospitality's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Target Hospitality's value and its price as these two are different measures arrived at by different means. Investors typically determine if Target Hospitality is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Target Hospitality's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.