Western Digital Stock Beneish M Score
| WDC Stock | USD 69.44 0.11 0.16% |
Western | Beneish M Score |
At this time, it appears that Western Digital is an unlikely manipulator. The earnings manipulation may begin if Western Digital'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 Western Digital 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 Western Digital'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.
-2.87
Beneish M Score - Unlikely Manipulator
Western Digital 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 Western Digital'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 Value | Last Year | Change From Last Year | 10 Year Trend | ||||||
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| Net Receivables | 976.6 M | 1.8 B |
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| Total Revenue | 8 B | 14.2 B |
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| Total Assets | 29.5 B | 28.1 B |
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| Total Current Assets | 9.5 B | 9.1 B |
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| Non Current Assets Total | 20 B | 19 B |
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| Property Plant Equipment | 2.3 B | 4.2 B |
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| Depreciation And Amortization | 570.8 M | 952.2 M |
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| Selling General Administrative | 544 M | 1 B |
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| Total Current Liabilities | 6.6 B | 6.2 B |
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| Non Current Liabilities Total | 21.9 B | 20.8 B |
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| Short Term Debt | 1.5 B | 1.4 B |
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| Long Term Debt | 4.4 B | 6.7 B |
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| Long Term Investments | 2 B | 3.2 B |
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| Gross Profit Margin | 0.18 | 0.14 |
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Western Digital 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 Western Digital's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Western Digital in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Western Digital's degree of accounting gimmicks and manipulations.
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About Western Digital 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 |
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Western Digital 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 Western Digital. 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.
| 2019 | 2020 | 2021 | 2022 | 2023 | 2024 (projected) | ||
| Net Receivables | 2.4B | 2.3B | 2.8B | 1.6B | 1.8B | 976.6M | |
| Total Revenue | 16.7B | 16.9B | 18.8B | 12.3B | 14.2B | 8.0B | |
| Total Assets | 25.7B | 26.1B | 26.3B | 24.4B | 28.1B | 29.5B | |
| Total Current Assets | 9.0B | 9.8B | 9.5B | 7.9B | 9.1B | 9.5B | |
| Net Debt | 6.5B | 5.4B | 4.7B | 5.0B | 5.8B | 6.1B | |
| Short Term Debt | 286M | 251M | 40M | 1.2B | 1.4B | 1.5B | |
| Long Term Debt | 9.3B | 8.5B | 7.0B | 5.9B | 6.7B | 4.4B | |
| Operating Income | 335M | 1.2B | 2.4B | (1.3B) | (1.5B) | (1.4B) | |
| Investments | 278M | 7M | 6M | (762M) | (685.8M) | (651.5M) |
Western Digital 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, Western Digital's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Western Digital's managers, analysts, and investors.Environment Score | Governance Score | Social Score |
About Western Digital Fundamental Analysis
The Macroaxis Fundamental Analysis modules help investors analyze Western Digital's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Western Digital using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Western Digital 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.
Western Digital Investors Sentiment
The influence of Western Digital's investor sentiment on the probability of its price appreciation or decline could be a good factor in your decision-making process regarding taking a position in Western. The overall investor sentiment generally increases the direction of a stock movement in a one-year investment horizon. However, the impact of investor sentiment on the entire stock market does not have solid backing from leading economists and market statisticians.
Investor biases related to Western Digital's public news can be used to forecast risks associated with an investment in Western. The trend in average sentiment can be used to explain how an investor holding Western can time the market purely based on public headlines and social activities around Western Digital. Please note that most equities that are difficult to arbitrage are affected by market sentiment the most.
Western Digital's market sentiment shows the aggregated news analyzed to detect positive and negative mentions from the text and comments. The data is normalized to provide daily scores for Western Digital's and other traded tickers. The bigger the bubble, the more accurate is the estimated score. Higher bars for a given day show more participation in the average Western Digital's news discussions. The higher the estimated score, the more favorable is the investor's outlook on Western Digital.
Western Digital Implied Volatility | 198.27 |
Western Digital's implied volatility exposes the market's sentiment of Western Digital stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Western Digital's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Western Digital stock will not fluctuate a lot when Western Digital's options are near their expiration.
Some investors attempt to determine whether the market's mood is bullish or bearish by monitoring changes in market sentiment. Unlike more traditional methods such as technical analysis, investor sentiment usually refers to the aggregate attitude towards Western Digital in the overall investment community. So, suppose investors can accurately measure the market's sentiment. In that case, they can use it for their benefit. For example, some tools to gauge market sentiment could be utilized using contrarian indexes, Western Digital's short interest history, or implied volatility extrapolated from Western Digital options trading.
Also Currently Popular
Analyzing currently trending equities could be an opportunity to develop a better portfolio based on different market momentums that they can trigger. Utilizing the top trending stocks is also useful when creating a market-neutral strategy or pair trading technique involving a short or a long position in a currently trending equity.When determining whether Western Digital offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Western Digital'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 Western Digital Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Western Digital Stock:Check out Western Digital Piotroski F Score and Western Digital Altman Z Score analysis. For information on how to trade Western Stock refer to our How to Trade Western Stock guide.Note that the Western Digital information on this page should be used as a complementary analysis to other Western Digital's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Odds Of Bankruptcy module to get analysis of equity chance of financial distress in the next 2 years.
Complementary Tools for Western Stock analysis
When running Western Digital's price analysis, check to measure Western Digital's 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 Western Digital is operating at the current time. Most of Western Digital's value examination focuses on studying past and present price action to predict the probability of Western Digital's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Western Digital's price. Additionally, you may evaluate how the addition of Western Digital to your portfolios can decrease your overall portfolio volatility.
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Is Western Digital's industry 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 Western Digital. If investors know Western 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 Western Digital 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 (0.96) | Earnings Share (7.26) | Revenue Per Share 35.014 | Quarterly Revenue Growth (0.41) | Return On Assets (0.04) |
The market value of Western Digital is measured differently than its book value, which is the value of Western that is recorded on the company's balance sheet. Investors also form their own opinion of Western Digital's value that differs from its market value or its book value, called intrinsic value, which is Western Digital'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 Western Digital's market value can be influenced by many factors that don't directly affect Western Digital'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 Western Digital's value and its price as these two are different measures arrived at by different means. Investors typically determine if Western Digital is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Western Digital'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.