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Benchmark Electronics (NYSE:BHE)
Beneish M-Score
-2.31 (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.

Benchmark Electronics has a M-score of -2.31 suggests that the company is not a manipulator.

BHE' s 10-Year Beneish M-Score Range
Min: -49.12   Max: -1.33
Current: -2.31

-49.12
-1.33

During the past 13 years, the highest Beneish M-Score of Benchmark Electronics was -1.33. The lowest was -49.12. And the median was -2.49.


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 Benchmark Electronics 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 * 1.1868+0.528 * 0.9625+0.404 * 1.0529+0.892 * 1.0155+0.115 * 0.9354
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0874+4.679 * 0.0074-0.327 * 1.0849
=-2.31

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $563 Mil.
Revenue was 756.843 + 599.658 + 607.522 + 542.444 = $2,506 Mil.
Gross Profit was 59.843 + 45.44 + 44.367 + 36.834 = $186 Mil.
Total Current Assets was $1,343 Mil.
Total Assets was $1,657 Mil.
Property, Plant and Equipment(Net PPE) was $185 Mil.
Depreciation, Depletion and Amortization(DDA) was $36 Mil.
Selling, General & Admin. Expense(SGA) was $99 Mil.
Total Current Liabilities was $398 Mil.
Long-Term Debt was $10 Mil.
Net Income was 67.489 + 23.726 + 8.457 + 11.487 = $111 Mil.
Non Operating Income was -0.661 + 0.745 + -0.501 + 0.316 = $-0 Mil.
Cash Flow from Operations was -0.854 + 38.713 + 12.57 + 48.648 = $99 Mil.
Accounts Receivable was $467 Mil.
Revenue was 633.933 + 610.769 + 630.031 + 593.417 = $2,468 Mil.
Gross Profit was 45.459 + 44.78 + 45.991 + 40.508 = $177 Mil.
Total Current Assets was $1,214 Mil.
Total Assets was $1,501 Mil.
Property, Plant and Equipment(Net PPE) was $176 Mil.
Depreciation, Depletion and Amortization(DDA) was $32 Mil.
Selling, General & Admin. Expense(SGA) was $90 Mil.
Total Current Liabilities was $331 Mil.
Long-Term Debt was $10 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)
=(562.994 / 2506.467) / (467.143 / 2468.15)
=0.22461656 / 0.18926848
=1.1868

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)
=(45.44 / 2468.15) / (59.843 / 2506.467)
=0.07160748 / 0.07440114
=0.9625

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 - (1342.833 + 185.319) / 1657.371) / (1 - (1214.191 + 176.104) / 1501.477)
=0.07796625 / 0.07404842
=1.0529

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
=2506.467 / 2468.15
=1.0155

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))
=(31.757 / (31.757 + 176.104)) / (36.179 / (36.179 + 185.319))
=0.15277998 / 0.16333782
=0.9354

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)
=(99.331 / 2506.467) / (89.951 / 2468.15)
=0.03962989 / 0.03644471
=1.0874

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)
=((9.521 + 398.377) / 1657.371) / ((10.103 + 330.515) / 1501.477)
=0.24611146 / 0.22685529
=1.0849

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
=(111.159 - -0.101 - 99.077) / 1657.371
=0.0074

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.

Benchmark Electronics has a M-score of -2.31 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.

Benchmark Electronics Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.10641.28980.98321.04650.97781.2360.94741.006311.1698
GMI 1.06311.07321.04511.00631.00220.96820.89921.266110.8282
AQI 0.93320.84740.96072.00610.56140.96250.92481.015610.8641
SGI 1.08781.12791.2881.0030.88830.80661.14980.937911.1125
DEPI 0.9321.25481.09870.85980.99250.96781.00671.336411.0909
SGAI 0.86460.90430.87341.34861.0941.15020.93841.036410.9958
LVGI 0.86171.11110.86350.84151.00520.97150.93931.074611.0183
TATA 0.03680.06410.1376-0.108-0.21-0.04640.0516-0.0015-0.00150.0074
M-score -2.06-1.81-1.51-2.55-3.78-2.70-2.21-2.38-2.49-2.33

Benchmark Electronics Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.12491.00631.18531.01970.95270.98570.84450.99840.93611.1868
GMI 1.12241.26681.23641.13651.02240.86050.85760.89030.92650.9625
AQI 0.9791.01561.00590.96830.89070.82070.83220.83670.81891.0529
SGI 0.9770.93790.97450.99491.03121.09551.04721.01790.99591.0155
DEPI 1.27851.33641.16951.12211.09421.16631.09391.06841.01430.9354
SGAI 1.01921.03641.01220.9870.95310.91580.94990.98661.03611.0874
LVGI 0.99011.07461.16051.09231.00380.93860.86731.01321.03681.0849
TATA 0.0402-0.00150.0171-0.0119-0.0554-0.0631-0.1087-0.0893-0.07650.0074
M-score -2.11-2.38-2.16-2.48-2.77-2.80-3.17-3.00-3.03-2.31
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