Switch to:
Altera Corp (NAS:ALTR)
Beneish M-Score
-2.72 (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.

Altera Corp has a M-score of -2.72 suggests that the company is not a manipulator.

ALTR' s 10-Year Beneish M-Score Range
Min: -3.27   Max: -0.37
Current: -2.72

-3.27
-0.37

During the past 13 years, the highest Beneish M-Score of Altera Corp was -0.37. The lowest was -3.27. And the median was -2.46.


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 Altera 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 * 0.7017+0.528 * 1.0302+0.404 * 1.1882+0.892 * 1.1152+0.115 * 0.8026
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8748+4.679 * -0.0341-0.327 * 0.9962
=-2.72

* 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 $378 Mil.
Revenue was 479.873 + 499.606 + 491.517 + 461.092 = $1,932 Mil.
Gross Profit was 311.701 + 333.587 + 329.126 + 309.224 = $1,284 Mil.
Total Current Assets was $3,289 Mil.
Total Assets was $5,674 Mil.
Property, Plant and Equipment(Net PPE) was $195 Mil.
Depreciation, Depletion and Amortization(DDA) was $66 Mil.
Selling, General & Admin. Expense(SGA) was $312 Mil.
Total Current Liabilities was $575 Mil.
Long-Term Debt was $1,493 Mil.
Net Income was 111.131 + 118.009 + 127.004 + 116.514 = $473 Mil.
Non Operating Income was -0.01 + 0.059 + 0.043 + 0.048 = $0 Mil.
Cash Flow from Operations was 150.778 + 214.049 + 170.958 + 130.43 = $666 Mil.
Accounts Receivable was $483 Mil.
Revenue was 454.367 + 445.945 + 421.759 + 410.501 = $1,733 Mil.
Gross Profit was 310.343 + 304.42 + 286.655 + 284.418 = $1,186 Mil.
Total Current Assets was $3,853 Mil.
Total Assets was $6,010 Mil.
Property, Plant and Equipment(Net PPE) was $204 Mil.
Depreciation, Depletion and Amortization(DDA) was $52 Mil.
Selling, General & Admin. Expense(SGA) was $320 Mil.
Total Current Liabilities was $707 Mil.
Long-Term Debt was $1,491 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)
=(377.964 / 1932.088) / (483.032 / 1732.572)
=0.19562463 / 0.27879476
=0.7017

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)
=(333.587 / 1732.572) / (311.701 / 1932.088)
=0.68443678 / 0.66437864
=1.0302

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 - (3288.543 + 194.84) / 5674.226) / (1 - (3852.84 + 204.142) / 6009.847)
=0.38610429 / 0.32494421
=1.1882

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
=1932.088 / 1732.572
=1.1152

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))
=(52.049 / (52.049 + 204.142)) / (66.04 / (66.04 + 194.84))
=0.20316483 / 0.25314321
=0.8026

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)
=(312.249 / 1932.088) / (320.068 / 1732.572)
=0.1616122 / 0.18473576
=0.8748

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)
=((1492.759 + 575.308) / 5674.226) / ((1491.466 + 707.386) / 6009.847)
=0.3644668 / 0.36587487
=0.9962

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
=(472.658 - 0.14 - 666.215) / 5674.226
=-0.0341

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.

Altera Corp has a M-score of -2.72 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.

Altera Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.07841.01262.16970.38772.99051.01950.60471.61361.53560.7017
GMI 1.03041.01091.03350.96191.00420.94131.00791.01161.01731.0302
AQI 3.21441.49350.2740.86311.04290.51261.84285.22441.96221.1882
SGI 1.10561.1440.98291.08210.87431.63491.05630.86370.97171.1152
DEPI 1.12411.06230.92331.14710.94580.99270.91621.03350.74660.8026
SGAI 0.96931.19110.89960.86731.04830.6651.03871.2021.13640.8748
LVGI 1.13020.88051.5271.12780.91590.73720.74570.94371.63380.9962
TATA -0.0937-0.07180.0104-0.0638-0.053-0.0196-0.0441-0.0066-0.025-0.0341
M-score -1.86-2.46-1.81-3.35-0.98-2.07-2.59-0.37-1.99-2.72

Altera Corp Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.08051.61361.42671.15041.31421.53561.22820.9130.83960.7017
GMI 1.01271.01161.00441.00471.0141.01731.0231.02121.02281.0302
AQI 5.30595.22444.90821.30631.15511.96222.07081.84171.83291.1882
SGI 0.83320.86370.94630.9660.95350.97170.98531.04881.111.1152
DEPI 1.02451.03350.89670.82590.76740.74660.73390.74110.7840.8026
SGAI 1.26131.2021.12731.12031.13261.13641.07370.99210.91980.8748
LVGI 0.87120.94370.980.95630.96781.63381.62191.5751.60160.9962
TATA -0.0212-0.0066-0.0179-0.0259-0.0248-0.025-0.023-0.0371-0.0322-0.0341
M-score -0.91-0.37-0.67-2.39-2.32-1.99-2.19-2.56-2.54-2.72
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK