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AGCO Corp (NYSE:AGCO)
Beneish M-Score
-2.35 (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.

AGCO Corp has a M-score of -2.35 suggests that the company is not a manipulator.

AGCO' s 10-Year Beneish M-Score Range
Min: -3.01   Max: -2.07
Current: -2.35

-3.01
-2.07

During the past 13 years, the highest Beneish M-Score of AGCO Corp was -2.07. The lowest was -3.01. And the median was -2.55.


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 AGCO 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 * 1.1367+0.528 * 1.0429+0.404 * 1.15+0.892 * 0.9014+0.115 * 0.8998
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0143+4.679 * 0.0029-0.327 * 0.9779
=-2.35

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $964 Mil.
Revenue was 2485.2 + 2154.8 + 2750.3 + 2333.4 = $9,724 Mil.
Gross Profit was 498 + 421.9 + 631.5 + 514.9 = $2,066 Mil.
Total Current Assets was $3,528 Mil.
Total Assets was $7,396 Mil.
Property, Plant and Equipment(Net PPE) was $1,530 Mil.
Depreciation, Depletion and Amortization(DDA) was $280 Mil.
Selling, General & Admin. Expense(SGA) was $995 Mil.
Total Current Liabilities was $2,217 Mil.
Long-Term Debt was $998 Mil.
Net Income was 77.6 + 65 + 168.2 + 99.6 = $410 Mil.
Non Operating Income was -14.9 + -10.1 + -12.9 + -11.2 = $-49 Mil.
Cash Flow from Operations was 653.7 + 38.9 + 256.8 + -511 = $438 Mil.
Accounts Receivable was $941 Mil.
Revenue was 2859.7 + 2475.9 + 3048.2 + 2403.1 = $10,787 Mil.
Gross Profit was 591 + 556.2 + 710.3 + 533.1 = $2,391 Mil.
Total Current Assets was $4,517 Mil.
Total Assets was $8,439 Mil.
Property, Plant and Equipment(Net PPE) was $1,602 Mil.
Depreciation, Depletion and Amortization(DDA) was $259 Mil.
Selling, General & Admin. Expense(SGA) was $1,089 Mil.
Total Current Liabilities was $2,812 Mil.
Long-Term Debt was $939 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)
=(963.8 / 9723.7) / (940.6 / 10786.9)
=0.09911865 / 0.08719836
=1.1367

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)
=(421.9 / 10786.9) / (498 / 9723.7)
=0.22162067 / 0.21250141
=1.0429

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 - (3527.9 + 1530.4) / 7395.9) / (1 - (4517.1 + 1602.3) / 8438.8)
=0.31606701 / 0.2748495
=1.15

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
=9723.7 / 10786.9
=0.9014

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))
=(259.4 / (259.4 + 1602.3)) / (280.4 / (280.4 + 1530.4))
=0.13933502 / 0.15484869
=0.8998

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)
=(995.4 / 9723.7) / (1088.7 / 10786.9)
=0.10236844 / 0.10092798
=1.0143

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)
=((997.6 + 2216.9) / 7395.9) / ((938.5 + 2812) / 8438.8)
=0.4346327 / 0.44443523
=0.9779

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
=(410.4 - -49.1 - 438.4) / 7395.9
=0.0029

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.

AGCO Corp has a M-score of -2.35 suggests that the company will not 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 own currency.

AGCO Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.77071.03540.9010.86251.14951.18370.83970.8390.93951.1367
GMI 1.05481.00350.97870.97981.08220.90130.90150.94990.96171.0429
AQI 1.03940.89820.97130.83791.1670.95421.27730.93560.89891.15
SGI 1.03350.99731.25631.23380.77351.05831.27211.13551.08280.9014
DEPI 1.01040.9971.0570.98431.17070.91391.15060.88441.00850.8998
SGAI 1.01320.84550.91940.93381.131.03780.98741.05480.96571.0143
LVGI 0.93190.98250.92831.05810.80821.02041.14960.910.98040.9779
TATA -0.0525-0.0803-0.04480.0231-0.038-0.0372-0.017-0.0142-0.01890.0029
M-score -2.84-2.83-2.53-2.38-2.55-2.53-2.43-2.62-2.60-2.35

AGCO Corp Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.03880.8390.92860.98570.99880.93951.0160.96180.96481.1367
GMI 0.90970.94990.96490.98180.99020.96170.96840.98341.02391.0429
AQI 1.29650.93560.91860.90360.88940.89890.95720.98291.04671.15
SGI 1.16061.13551.09111.09071.08741.08281.0620.99710.94990.9014
DEPI 0.97910.88440.88330.94070.94691.00851.02031.01640.94720.8998
SGAI 1.05141.05481.051.03190.98780.96570.9791.00281.02171.0143
LVGI 1.11530.910.94660.95610.96690.98040.97720.95151.01440.9779
TATA 0.041-0.0142-0.0165-0.0428-0.0327-0.01890.00950.01250.01340.0029
M-score -2.09-2.62-2.60-2.66-2.60-2.60-2.39-2.46-2.48-2.35
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