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Broadwind Energy, Inc. (NAS:BWEN)
Beneish M-Score
-4.14 (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.

Broadwind Energy, Inc. has a M-score of -4.14 suggests that the company is not a manipulator.

BWEN' s 10-Year Beneish M-Score Range
Min: -4.75   Max: 13.07
Current: -4.14

-4.75
13.07

During the past 13 years, the highest Beneish M-Score of Broadwind Energy, Inc. was 13.07. The lowest was -4.75. And the median was -2.94.


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 Broadwind Energy, 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 * 0.9132+0.528 * 0.5669+0.404 * 0.8743+0.892 * 1.0237+0.115 * 0.9689
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9669+4.679 * -0.2482-0.327 * 1.5037
=-4.14

* 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 $18.7 Mil.
Revenue was 56.397 + 60.862 + 52.945 + 45.506 = $215.7 Mil.
Gross Profit was 2.156 + 4.618 + 3.401 + 2.17 = $12.3 Mil.
Total Current Assets was $86.3 Mil.
Total Assets was $163.7 Mil.
Property, Plant and Equipment(Net PPE) was $69.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $14.9 Mil.
Selling, General & Admin. Expense(SGA) was $21.4 Mil.
Total Current Liabilities was $60.5 Mil.
Long-Term Debt was $3.9 Mil.
Net Income was -3.746 + -2.398 + 0.404 + -4.759 = $-10.5 Mil.
Non Operating Income was 0.402 + -0.005 + 3.133 + 0.348 = $3.9 Mil.
Cash Flow from Operations was 4.747 + 7.731 + 16.616 + -2.84 = $26.3 Mil.
Accounts Receivable was $20.0 Mil.
Revenue was 44.908 + 55.045 + 56.311 + 54.443 = $210.7 Mil.
Gross Profit was 0.23 + 2.715 + 1.659 + 2.232 = $6.8 Mil.
Total Current Assets was $54.8 Mil.
Total Assets was $142.9 Mil.
Property, Plant and Equipment(Net PPE) was $79.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $16.5 Mil.
Selling, General & Admin. Expense(SGA) was $21.6 Mil.
Total Current Liabilities was $33.8 Mil.
Long-Term Debt was $3.6 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)
=(18.735 / 215.71) / (20.039 / 210.707)
=0.08685272 / 0.09510363
=0.9132

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)
=(4.618 / 210.707) / (2.156 / 215.71)
=0.03244316 / 0.05722961
=0.5669

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 - (86.335 + 69.077) / 163.694) / (1 - (54.751 + 79.889) / 142.91)
=0.0505944 / 0.05786859
=0.8743

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
=215.71 / 210.707
=1.0237

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))
=(16.537 / (16.537 + 79.889)) / (14.856 / (14.856 + 69.077))
=0.17149939 / 0.17699832
=0.9689

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)
=(21.414 / 215.71) / (21.634 / 210.707)
=0.09927217 / 0.10267338
=0.9669

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)
=((3.948 + 60.528) / 163.694) / ((3.597 + 33.836) / 142.91)
=0.39388127 / 0.26193408
=1.5037

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
=(-10.499 - 3.878 - 26.254) / 163.694
=-0.2482

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.

Broadwind Energy, Inc. has a M-score of -4.14 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.

Broadwind Energy, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.437311.35270.37180.70221.31960.87010.69830.9132
GMI 5.227-1.50270.86072.38374.53150.36761.19190.5669
AQI 27.14444.17890.66110.60690.3040.88380.98490.8743
SGI 2.04527.40847.29170.85030.74081.35761.13371.0237
DEPI 0.79961.85830.430.91931.06490.94380.82840.9689
SGAI 0.78220.61760.99540.91781.1410.70730.72510.9669
LVGI 1.16550.16670.76851.03030.97721.02790.83541.5037
TATA -0.5189-0.0187-0.0598-0.5198-0.3971-0.0675-0.113-0.2482
M-score 8.2613.072.07-4.75-2.70-2.94-2.99-4.14

Broadwind Energy, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 0.60080.87010.83240.67280.97920.69831.10770.9430.82730.9132
GMI -0.84130.36761.45412.50751.91011.19191.03540.60680.67170.5669
AQI 0.31530.88380.890.85370.94030.98490.85470.82090.92180.8743
SGI 1.6321.35761.241.29991.23881.13371.02540.92820.92451.0237
DEPI 0.75050.94380.86470.85340.8580.82840.85970.82040.91830.9689
SGAI 0.60360.70740.80140.72070.72550.72510.79710.91250.96630.9669
LVGI 1.44411.02791.00391.08250.99870.83541.04781.00221.1831.5037
TATA -0.3433-0.0675-0.0041-0.06050.0011-0.113-0.1004-0.1971-0.3376-0.2482
M-score -5.24-2.94-2.23-2.06-1.79-2.99-2.86-3.81-4.55-4.14
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