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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.
During the past 13 years, the highest Beneish M-Score of First Majestic Silver Corp was 10000000.00. The lowest was -10000000.00. And the median was -2.54.
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 First Majestic Silver Corp 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 * 0.6732||+||0.528 * 0.9672||+||0.404 * 5.8765||+||0.892 * 0.894||+||0.115 * 0.7766|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 0.9092||+||4.679 * -0.2034||-||0.327 * 0.8549|
|This Year (Dec15) TTM:||Last Year (Dec14) TTM:|
|Accounts Receivable was $3.2 Mil.|
Revenue was 66.012 + 44.673 + 54.19 + 54.569 = $219.4 Mil.
Gross Profit was 26.533 + 14.128 + 20.876 + 22.233 = $83.8 Mil.
Total Current Assets was $104.8 Mil.
Total Assets was $789.7 Mil.
Property, Plant and Equipment(Net PPE) was $647.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $75.8 Mil.
Selling, General & Admin. Expense(SGA) was $21.1 Mil.
Total Current Liabilities was $89.2 Mil.
Long-Term Debt was $18.7 Mil.
Net Income was -102.961 + -1.78 + -2.578 + -1.105 = $-108.4 Mil.
Non Operating Income was -4.062 + 1.573 + -2.774 + 1.377 = $-3.9 Mil.
Cash Flow from Operations was 17.628 + 10.866 + 21.25 + 6.35 = $56.1 Mil.
|Accounts Receivable was $5.4 Mil.
Revenue was 72.48 + 40.77 + 66.927 + 65.296 = $245.5 Mil.
Gross Profit was 27.607 + 8.797 + 24.2 + 30.026 = $90.6 Mil.
Total Current Assets was $75.4 Mil.
Total Assets was $771.3 Mil.
Property, Plant and Equipment(Net PPE) was $689.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $61.2 Mil.
Selling, General & Admin. Expense(SGA) was $26.0 Mil.
Total Current Liabilities was $78.2 Mil.
Long-Term Debt was $45.1 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(3.249 / 219.444)||/||(5.399 / 245.473)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(14.128 / 245.473)||/||(26.533 / 219.444)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (104.785 + 647.078) / 789.7)||/||(1 - (75.352 + 689.701) / 771.342)|
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.
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))|
|=||(61.163 / (61.163 + 689.701))||/||(75.822 / (75.822 + 647.078))|
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)|
|=||(21.146 / 219.444)||/||(26.016 / 245.473)|
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)|
|=||((18.74 + 89.201) / 789.7)||/||((45.102 + 78.222) / 771.342)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(-108.424 - -3.886||-||56.094)||/||789.7|
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.
First Majestic Silver Corp has a M-score of -1.84 signals that the company is likely to be a manipulator.
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
First Majestic Silver Corp Annual Data
First Majestic Silver Corp Quarterly Data