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GuruFocus has detected 3 Warning Signs with Yamana Gold Inc $AUY.
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Yamana Gold Inc (NYSE:AUY)
Beneish M-Score
-3.83 (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.

Yamana Gold Inc has a M-score of -3.82 suggests that the company is not a manipulator.

AUY' s Beneish M-Score Range Over the Past 10 Years
Min: -45.79   Max: 358.85
Current: -3.83

-45.79
358.85

During the past 13 years, the highest Beneish M-Score of Yamana Gold Inc was 358.85. The lowest was -45.79. And the median was -2.87.


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 Yamana Gold 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 * 0.8417+0.528 * -0.4702+0.404 * 1.1184+0.892 * 0.9812+0.115 * 1.1016
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8825+4.679 * -0.1029-0.327 * 0.9986
=-3.82

* 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 $35 Mil.
Revenue was 484.4 + 464.3 + 466.5 + 430.3 = $1,846 Mil.
Gross Profit was -639.3 + 91 + 63.7 + 90 = $-395 Mil.
Total Current Assets was $552 Mil.
Total Assets was $8,802 Mil.
Property, Plant and Equipment(Net PPE) was $7,566 Mil.
Depreciation, Depletion and Amortization(DDA) was $467 Mil.
Selling, General & Admin. Expense(SGA) was $101 Mil.
Total Current Liabilities was $475 Mil.
Long-Term Debt was $1,574 Mil.
Net Income was -367.2 + -11.8 + 34.8 + 36.3 = $-308 Mil.
Non Operating Income was -10 + -20.2 + -9.1 + -27.9 = $-67 Mil.
Cash Flow from Operations was 163.8 + 176.4 + 201.9 + 122.9 = $665 Mil.
Accounts Receivable was $43 Mil.
Revenue was 543.4 + 424.4 + 455 + 458.1 = $1,881 Mil.
Gross Profit was 42.7 + 52.1 + 56.2 + 38.1 = $189 Mil.
Total Current Assets was $649 Mil.
Total Assets was $9,518 Mil.
Property, Plant and Equipment(Net PPE) was $8,209 Mil.
Depreciation, Depletion and Amortization(DDA) was $562 Mil.
Selling, General & Admin. Expense(SGA) was $116 Mil.
Total Current Liabilities was $542 Mil.
Long-Term Debt was $1,677 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)
=(35.1 / 1845.5) / (42.5 / 1880.9)
=0.01901924 / 0.02259557
=0.8417

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)
=(189.1 / 1880.9) / (-394.6 / 1845.5)
=0.10053698 / -0.21381739
=-0.4702

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 - (552.4 + 7566.3) / 8801.7) / (1 - (649 + 8208.7) / 9518.1)
=0.07759865 / 0.0693836
=1.1184

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
=1845.5 / 1880.9
=0.9812

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))
=(561.9 / (561.9 + 8208.7)) / (467.2 / (467.2 + 7566.3))
=0.06406631 / 0.05815647
=1.1016

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)
=(100.7 / 1845.5) / (116.3 / 1880.9)
=0.05456516 / 0.0618321
=0.8825

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)
=((1573.8 + 475.1) / 8801.7) / ((1676.7 + 542.1) / 9518.1)
=0.23278458 / 0.23311375
=0.9986

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
=(-307.9 - -67.2 - 665) / 8801.7
=-0.1029

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.

Yamana Gold Inc has a M-score of -3.82 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 local exchange's currency.

Yamana Gold Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.61160.25982.9451.48910.73650.80890.57050.60690.90550.8431
GMI 0.6651.73980.93560.84540.88311.05471.6351.88441.4575-0.4604
AQI 0.3830.99962.20591.1590.75720.87210.74641.64611.11061.1184
SGI 4.41531.27071.24641.42551.28841.07520.78860.99590.99440.9796
DEPI 2.22710.39430.74290.80270.8921.05470.95690.85410.71131.0755
SGAI 0.23960.66411.39140.75370.86511.11761.17650.90830.96940.9023
LVGI 1.89790.87251.01020.94741.00751.41371.31661.38051.05470.9986
TATA -0.0049-0.015-0.038-0.0181-0.0516-0.0607-0.0961-0.1542-0.2745-0.1032
M-score -0.26-2.57-0.30-1.72-2.86-3.04-3.42-2.96-3.62-3.82

Yamana Gold Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 0.85440.60690.57460.38350.87850.58070.49370.8417
GMI 2.46761.88431.46821.25791.54921.15310.825-0.4702
AQI 1.19781.64611.66980.94441.11061.39041.47111.1184
SGI 0.83490.99581.1671.09791.0250.95561.01280.9812
DEPI 0.86610.85430.8470.88040.68740.75480.77881.1016
SGAI 1.02410.91470.78420.8420.9270.98090.89250.8825
LVGI 1.45941.38051.21880.95531.05471.16661.14910.9986
TATA -0.1708-0.1541-0.164-0.0865-0.2744-0.2599-0.2593-0.1029
M-score -2.88-2.97-3.02-3.22-3.56-3.96-4.11-3.82
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