Old Second Bancorp Stock Beneish M Score

OSBC Stock  USD 18.71  0.20  1.08%   
This module uses fundamental data of Old Second to approximate the value of its Beneish M Score. Old Second 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 Old Second Piotroski F Score and Old Second Altman Z Score analysis.
  
At present, Old Second's Net Debt is projected to increase significantly based on the last few years of reporting. The current year's Short Term Debt is expected to grow to about 425.2 M, whereas Long Term Debt Total is forecasted to decline to about 122.5 M. At present, Old Second's PTB Ratio is projected to increase slightly based on the last few years of reporting. The current year's Days Sales Outstanding is expected to grow to 408.96, whereas Dividend Yield is forecasted to decline to 0.01.
At this time, it appears that Old Second Bancorp is an unlikely manipulator. The earnings manipulation may begin if Old Second'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 Old Second 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 Old Second'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.
-2.53
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables

1.0

Focus
Asset Quality

1.01

Focus
Expense Coverage

1.0

Focus
Gross Margin Strengs

0.86

Focus
Accruals Factor

1.0

Focus
Depreciation Resistance

0.69

Focus
Net Sales Growth

1.05

Focus
Financial Leverage Condition

1.0

Focus

Old Second 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 Old Second'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 Receivables415 M395.3 M
Sufficiently Up
Slightly volatile
Total Revenue306.6 M292 M
Sufficiently Up
Slightly volatile
Total AssetsB5.7 B
Sufficiently Up
Slightly volatile
Total Current Assets95.1 M100.1 M
Notably Down
Very volatile
Non Current Assets Total5.9 B5.6 B
Sufficiently Up
Slightly volatile
Property Plant Equipment59.2 M85 M
Way Down
Pretty Stable
Depreciation And Amortization7.3 M6.9 M
Sufficiently Up
Slightly volatile
Selling General Administrative97.1 M92.5 M
Sufficiently Up
Slightly volatile
Total Current Liabilities4.1 B3.9 B
Sufficiently Up
Slightly volatile
Non Current Liabilities Total5.4 B5.1 B
Sufficiently Up
Slightly volatile
Short Term Debt425.2 M405 M
Sufficiently Up
Slightly volatile
Long Term Debt94.4 M85.2 M
Significantly Up
Slightly volatile
Operating Income130.6 M124.4 M
Sufficiently Up
Slightly volatile
Short Term Investments1.3 B1.2 B
Sufficiently Up
Slightly volatile
Long Term Investments1.6 B1.2 B
Significantly Up
Slightly volatile
Gross Profit Margin0.750.87
Fairly Down
Slightly volatile

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

About Old Second 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

7.29 Million

At present, Old Second's Depreciation And Amortization is projected to increase significantly based on the last few years of reporting.

Old Second 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 Old Second. 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 Receivables119.8M141.6M158.2M277.4M395.3M415.0M
Total Revenue131.6M127.0M133.5M244.9M292.0M306.6M
Total Assets2.6B3.0B6.2B5.9B5.7B6.0B
Total Current Assets655.0M967.7M2.6B1.9B100.1M95.1M
Net Debt106.5M(236.4M)(603.6M)113.5M390.0M409.5M
Short Term Debt48.5M23.4M19.1M99M405M425.3M
Long Term Debt108.7M93.5M148.5M138.7M85.2M94.4M
Operating Income51.9M37.4M27.9M106.0M124.4M130.6M
Investments42.6M(103.1M)(19.3M)(442.0M)198.1M208.0M

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

About Old Second Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Old Second Bancorp's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Old Second using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Old Second Bancorp 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 Old Second Bancorp offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Old Second's financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Old Second Bancorp Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Old Second Bancorp Stock:
Check out Old Second Piotroski F Score and Old Second Altman Z Score analysis.
You can also try the Price Transformation module to use Price Transformation models to analyze the depth of different equity instruments across global markets.
Is Regional Banks 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 Old Second. If investors know Old 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 Old Second 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
(0.07)
Dividend Share
0.2
Earnings Share
1.85
Revenue Per Share
5.896
Quarterly Revenue Growth
(0.01)
The market value of Old Second Bancorp is measured differently than its book value, which is the value of Old that is recorded on the company's balance sheet. Investors also form their own opinion of Old Second's value that differs from its market value or its book value, called intrinsic value, which is Old Second'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 Old Second's market value can be influenced by many factors that don't directly affect Old Second'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 Old Second's value and its price as these two are different measures arrived at by different means. Investors typically determine if Old Second is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Old Second'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.