Switch to:
Air Products & Chemicals Inc (NYSE:APD)
Beneish M-Score
-3.00 (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.

Air Products & Chemicals Inc has a M-score of -3.00 suggests that the company is not a manipulator.

APD' s 10-Year Beneish M-Score Range
Min: -3.22   Max: -2.4
Current: -3

-3.22
-2.4

During the past 13 years, the highest Beneish M-Score of Air Products & Chemicals Inc was -2.40. The lowest was -3.22. And the median was -2.72.


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 Air Products & Chemicals 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 * 0.9134+0.528 * 0.9184+0.404 * 0.9311+0.892 * 0.9782+0.115 * 0.9927
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.934+4.679 * -0.0781-0.327 * 0.9729
=-3.00

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $1,441 Mil.
Revenue was 2470.2 + 2414.5 + 2560.8 + 2677 = $10,123 Mil.
Gross Profit was 753.8 + 714.9 + 729.8 + 744.6 = $2,943 Mil.
Total Current Assets was $3,102 Mil.
Total Assets was $17,672 Mil.
Property, Plant and Equipment(Net PPE) was $9,721 Mil.
Depreciation, Depletion and Amortization(DDA) was $956 Mil.
Selling, General & Admin. Expense(SGA) was $1,004 Mil.
Total Current Liabilities was $2,919 Mil.
Long-Term Debt was $4,691 Mil.
Net Income was 318.8 + 290 + 324.6 + 104 = $1,037 Mil.
Non Operating Income was 42.4 + 33 + 43.1 + 39.7 = $158 Mil.
Cash Flow from Operations was 690.7 + 480.6 + 486.6 + 601.7 = $2,260 Mil.
Accounts Receivable was $1,613 Mil.
Revenue was 2634.6 + 2581.9 + 2545.5 + 2586.5 = $10,349 Mil.
Gross Profit was 715.9 + 664.3 + 679.6 + 703.6 = $2,763 Mil.
Total Current Assets was $3,340 Mil.
Total Assets was $18,316 Mil.
Property, Plant and Equipment(Net PPE) was $9,579 Mil.
Depreciation, Depletion and Amortization(DDA) was $935 Mil.
Selling, General & Admin. Expense(SGA) was $1,099 Mil.
Total Current Liabilities was $3,156 Mil.
Long-Term Debt was $4,951 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)
=(1440.8 / 10122.5) / (1612.7 / 10348.5)
=0.14233638 / 0.15583901
=0.9134

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)
=(714.9 / 10348.5) / (753.8 / 10122.5)
=0.26703387 / 0.29074833
=0.9184

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 - (3102.3 + 9720.8) / 17671.5) / (1 - (3339.8 + 9579.1) / 18316.2)
=0.27436267 / 0.29467357
=0.9311

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
=10122.5 / 10348.5
=0.9782

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))
=(934.9 / (934.9 + 9579.1)) / (956.4 / (956.4 + 9720.8))
=0.08891954 / 0.08957405
=0.9927

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)
=(1004 / 10122.5) / (1099 / 10348.5)
=0.09918498 / 0.10619897
=0.934

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)
=((4690.5 + 2918.9) / 17671.5) / ((4951 + 3156.1) / 18316.2)
=0.43060295 / 0.4426191
=0.9729

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
=(1037.4 - 158.2 - 2259.6) / 17671.5
=-0.0781

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.

Air Products & Chemicals Inc has a M-score of -3.00 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.

Air Products & Chemicals Inc Annual Data

Sep05Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14
DSRI 0.90431.06350.86730.87661.09160.99440.85731.14180.94390.9384
GMI 1.01241.04440.97311.02460.97440.95941.050.99961.00110.9903
AQI 1.11281.03181.14960.9790.98451.04051.07151.14960.97630.9145
SGI 1.10471.12671.04521.13840.79281.09321.07180.99361.05921.0254
DEPI 1.00030.98850.97650.97181.0641.00041.05351.11841.00861.0062
SGAI 0.95950.94130.88980.98461.40950.70730.90731.01191.08570.9537
LVGI 1.00771.07421.03581.06821.04770.91581.00360.97871.08090.9438
TATA -0.0766-0.0655-0.0501-0.0728-0.0622-0.0459-0.0448-0.0444-0.0407-0.0757
M-score -2.78-2.59-2.75-2.83-2.97-2.54-2.68-2.48-2.72-2.88

Air Products & Chemicals Inc Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.06121.06240.94391.00361.03430.98360.93840.89070.85390.9134
GMI 0.98191.00881.00110.99271.00640.98670.99030.98210.93840.9184
AQI 1.17161.09840.97630.98640.95830.96430.91450.91440.9390.9311
SGI 1.03611.07231.05921.03161.02691.01461.02541.02861.00250.9782
DEPI 1.04261.03561.00861.00121.03591.05251.00621.00990.98150.9927
SGAI 1.03861.04871.08591.08531.05561.02760.95370.91980.93750.934
LVGI 1.06421.14841.08090.98190.98760.9670.94380.96450.96210.9729
TATA -0.035-0.0424-0.0407-0.0544-0.0633-0.0664-0.0757-0.0713-0.0717-0.0781
M-score -2.52-2.56-2.72-2.72-2.74-2.80-2.88-2.91-2.98-3.00
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)

GuruFocus Premium Plus Membership

FEEDBACK