Ethan Allen Interiors Stock Beneish M Score

ETD Stock  USD 31.04  1.11  3.71%   
This module uses fundamental data of Ethan Allen to approximate the value of its Beneish M Score. Ethan Allen 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 Ethan Allen Piotroski F Score and Ethan Allen Altman Z Score analysis.
  
At present, Ethan Allen's Long Term Debt is projected to increase significantly based on the last few years of reporting. The current year's Net Debt To EBITDA is expected to grow to 0.64, whereas Net Debt is forecasted to decline to about 31.6 M. At present, Ethan Allen's Dividend Yield is projected to increase slightly based on the last few years of reporting. The current year's PTB Ratio is expected to grow to 2.41, whereas Free Cash Flow Yield is forecasted to decline to 0.06.
At this time, it appears that Ethan Allen Interiors is an unlikely manipulator. The earnings manipulation may begin if Ethan Allen'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 Ethan Allen 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 Ethan Allen'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.
-2.54
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables

0.75

Focus
Asset Quality

1.48

Focus
Expense Coverage

0.82

Focus
Gross Margin Strengs

0.67

Focus
Accruals Factor

0.82

Focus
Depreciation Resistance

0.89

Focus
Net Sales Growth

1.27

Focus
Financial Leverage Condition

0.89

Focus

Ethan Allen 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 Ethan Allen'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 Receivables6.4 M6.8 M
Notably Down
Slightly volatile
Total Revenue819.5 M646.2 M
Significantly Up
Slightly volatile
Total Assets664.3 M744.9 M
Fairly Down
Slightly volatile
Total Current Assets292.8 M332.7 M
Fairly Down
Slightly volatile
Non Current Assets Total371.5 M412.2 M
Moderately Down
Slightly volatile
Property Plant Equipment335 M388.7 M
Fairly Down
Slightly volatile
Depreciation And Amortization15.4 M16 M
Sufficiently Down
Slightly volatile
Selling General Administrative311.7 M298.3 M
Sufficiently Up
Slightly volatile
Total Current Liabilities137.2 M153.7 M
Fairly Down
Slightly volatile
Non Current Liabilities Total96.3 M108.3 M
Fairly Down
Slightly volatile
Short Term Debt29.1 M27.7 M
Sufficiently Up
Slightly volatile
Long Term Debt60.4 M57.5 M
Sufficiently Up
Slightly volatile
Total Cash From Operating Activities82.6 M80.2 M
Fairly Up
Slightly volatile
Gross Profit Margin0.410.6082
Way Down
Pretty Stable

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

About Ethan Allen 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

728.16 Million

At present, Ethan Allen's Other Operating Expenses is projected to increase significantly based on the last few years of reporting.

Ethan Allen 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 Ethan Allen. 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 Receivables8.1M9.0M17.0M11.6M6.8M6.4M
Total Revenue589.8M685.2M817.8M791.4M646.2M819.5M
Total Assets622.8M683.2M719.9M745.5M744.9M664.3M
Total Current Assets230.0M295.3M346.7M359.5M332.7M292.8M
Net Debt107.2M20.7M5.3M68.2M59.6M31.6M
Short Term Debt27.4M54.8M26.2M26.4M27.7M29.1M
Operating Income(8.3M)77.3M138.3M137.2M78.0M62.3M
Investments(7.1M)(11.2M)(101.5M)(66.0M)(20.0M)(21.0M)

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

About Ethan Allen Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Ethan Allen Interiors's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Ethan Allen using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Ethan Allen Interiors 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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When determining whether Ethan Allen Interiors is a strong investment it is important to analyze Ethan Allen's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Ethan Allen's future performance. For an informed investment choice regarding Ethan Stock, refer to the following important reports:
Check out Ethan Allen Piotroski F Score and Ethan Allen Altman Z Score analysis.
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Is Household Durables 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 Ethan Allen. If investors know Ethan 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 Ethan Allen 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
(0.02)
Dividend Share
1.5
Earnings Share
2.48
Revenue Per Share
24.932
Quarterly Revenue Growth
(0.06)
The market value of Ethan Allen Interiors is measured differently than its book value, which is the value of Ethan that is recorded on the company's balance sheet. Investors also form their own opinion of Ethan Allen's value that differs from its market value or its book value, called intrinsic value, which is Ethan Allen'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 Ethan Allen's market value can be influenced by many factors that don't directly affect Ethan Allen'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 Ethan Allen's value and its price as these two are different measures arrived at by different means. Investors typically determine if Ethan Allen is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Ethan Allen'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.