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GuruFocus has detected 6 Warning Signs with Axcelis Technologies Inc $ACLS.
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Axcelis Technologies Inc (NAS:ACLS)
Beneish M-Score
-1.68 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Axcelis Technologies Inc has a M-score of -1.68 signals that the company is a manipulator.

ACLS' s Beneish M-Score Range Over the Past 10 Years
Min: -4.53   Max: 0.87
Current: -1.68

-4.53
0.87

During the past 13 years, the highest Beneish M-Score of Axcelis Technologies Inc was 0.87. The lowest was -4.53. And the median was -2.49.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (F-Score), M-score can be used to detect the risk of earnings manipulation. This is the original research paper on M-score.

The M-Score Variables:

The M-score of Axcelis Technologies Inc for today is based on a combination of the following eight different indices:

M=-4.84+0.92 * DSRI+0.528 * GMI+0.404 * AQI+0.892 * SGI+0.115 * DEPI
=-4.84+0.92 * 1.5491+0.528 * 0.9043+0.404 * 1.3116+0.892 * 0.8855+0.115 * 1.15
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1271+4.679 * 0.068-0.327 * 0.9664
=-1.68

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $50.6 Mil.
Revenue was 69.358 + 65.65 + 64.451 + 67.521 = $267.0 Mil.
Gross Profit was 26.947 + 24.104 + 25.131 + 23.416 = $99.6 Mil.
Total Current Assets was $240.7 Mil.
Total Assets was $302.2 Mil.
Property, Plant and Equipment(Net PPE) was $30.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.3 Mil.
Selling, General & Admin. Expense(SGA) was $48.3 Mil.
Total Current Liabilities was $47.7 Mil.
Long-Term Debt was $47.6 Mil.
Net Income was 3.965 + 2.151 + 2.937 + 1.948 = $11.0 Mil.
Non Operating Income was -0.412 + -0.055 + -0.238 + -0.059 = $-0.8 Mil.
Cash Flow from Operations was 4.216 + 3.69 + -6.522 + -10.183 = $-8.8 Mil.
Accounts Receivable was $36.9 Mil.
Revenue was 70.458 + 79.317 + 78.437 + 73.283 = $301.5 Mil.
Gross Profit was 21.973 + 29.179 + 27.174 + 23.38 = $101.7 Mil.
Total Current Assets was $230.0 Mil.
Total Assets was $281.8 Mil.
Property, Plant and Equipment(Net PPE) was $30.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.9 Mil.
Selling, General & Admin. Expense(SGA) was $48.4 Mil.
Total Current Liabilities was $44.4 Mil.
Long-Term Debt was $47.6 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in receivables in year t to year t-1.

A large increase in DSR could be indicative of revenue inflation.

DSRI=(Receivables_t / Revenue_t) / (Receivables_t-1 / Revenue_t-1)
=(50.573 / 266.98) / (36.868 / 301.495)
=0.18942617 / 0.12228395
=1.5491

2. GMI = Gross Margin Index

Measured as the ratio of gross margin in year t-1 to gross margin in year t.

Gross margin has deteriorated when this index is above 1. A firm with poorer prospects is more likely to manipulate earnings.

GMI=GrossMargin_t-1 / GrossMargin_t
=(GrossProfit_t-1 / Revenue_t-1) / (GrossProfit_t / Revenue_t)
=(101.706 / 301.495) / (99.598 / 266.98)
=0.33733893 / 0.37305416
=0.9043

3. AQI = Asset Quality Index

AQI is the ratio of asset quality in year t to year t-1.

Asset quality is measured as the ratio of non-current assets other than plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (240.729 + 30.84) / 302.231) / (1 - (229.957 + 30.031) / 281.784)
=0.1014522 / 0.07735003
=1.3116

4. SGI = Sales Growth Index

Ratio of sales in year t to sales in year t-1.

Sales growth is not itself a measure of manipulation. However, growth companies are likely to find themselves under pressure to manipulate in order to keep up appearances.

SGI=Sales_t / Sales_t-1
=Revenue_t / Revenue_t-1
=266.98 / 301.495
=0.8855

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation in year t-1 to the corresponding rate in year t.

DEPI greater than 1 indicates that assets are being depreciated at a slower rate. This suggests that the firm might be revising useful asset life assumptions upwards, or adopting a new method that is income friendly.

DEPI=(Depreciation_t-1 / (Depreciaton_t-1 + PPE_t-1)) / (Depreciation_t / (Depreciaton_t + PPE_t))
=(4.869 / (4.869 + 30.031)) / (4.258 / (4.258 + 30.84))
=0.13951289 / 0.12131745
=1.15

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses in year t relative to year t-1.

SGA expenses index > 1 means that the company is becoming less efficient in generate sales.

SGAI=(SGA_t / Sales_t) / (SGA_t-1 /Sales_t-1)
=(48.291 / 266.98) / (48.384 / 301.495)
=0.18087872 / 0.16048027
=1.1271

7. LVGI = Leverage Index

The ratio of total debt to total assets in year t relative to yeat t-1.

An LVGI > 1 indicates an increase$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((47.586 + 47.731) / 302.231) / ((47.586 + 44.368) / 281.784)
=0.31537797 / 0.32632797
=0.9664

8. TATA = Total Accruals to Total Assets

Total accruals calculated as the change in working capital accounts other than cash less depreciation.

TATA=(IncomefromContinuingOperations_t - CashFlowsfromOperations_t) / TotalAssets_t
=(NetIncome_t - NonOperatingIncome_t - CashFlowsfromOperations_t) / TotalAssets_t
=(11.001 - -0.764 - -8.799) / 302.231
=0.068

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Axcelis Technologies Inc has a M-score of -1.68 signals that the company is likely to be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Axcelis Technologies Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 1.17830.58461.30671.46540.5221.11251.53111.12690.58021.5491
GMI 1.09841.5091.18620.67640.86831.25590.82361.0051.02430.9043
AQI 1.18321.11840.17280.7551.52930.75841.26390.74341.46071.3116
SGI 0.87670.61810.53162.06891.16060.63670.96191.03791.48480.8855
DEPI 0.95290.70232.25160.99730.83021.11631.21691.04540.93841.15
SGAI 1.13491.54611.27280.48650.87241.36290.92440.9230.72951.1271
LVGI 0.73311.10.41582.04280.72690.76031.59661.06921.4260.9664
TATA 0.0141-0.3166-0.151-0.02740.0046-0.0988-0.00440.0143-0.01060.068
M-score -2.18-4.53-3.27-1.75-2.52-3.10-2.19-2.37-2.38-1.68

Axcelis Technologies Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 0.93071.12691.12281.0850.87710.58020.80911.3561.2741.5491
GMI 0.7111.0051.06741.06411.08721.02430.96850.94460.95090.9043
AQI 0.86060.74340.57610.83960.7811.46072.1171.72241.98891.3116
SGI 1.09581.03790.99881.20721.47451.48481.37231.11460.91320.8855
DEPI 1.11231.04541.00290.97360.94130.93841.01261.02351.08371.15
SGAI 0.84260.9230.95080.80480.71640.72950.79780.96881.09571.1271
LVGI 0.96881.06921.73911.79951.61681.4260.44130.49630.410.9664
TATA 0.02830.0143-0.0255-0.01890.0143-0.01060.05330.07530.0530.068
M-score -2.48-2.37-2.86-2.57-2.31-2.38-1.42-1.26-1.50-1.68
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