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Broadwind Energy Inc (NAS:BWEN)
Beneish M-Score
-3.14 (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 -3.14 suggests that the company is not a manipulator.

BWEN' s 10-Year Beneish M-Score Range
Min: -13.43   Max: 16.14
Current: -3.14

-13.43
16.14

During the past 13 years, the highest Beneish M-Score of Broadwind Energy Inc was 16.14. The lowest was -13.43. And the median was -2.73.


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 * 0.9351+0.528 * 0.6303+0.404 * 0.7671+0.892 * 1.1941+0.115 * 1.0552
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8844+4.679 * -0.1086-0.327 * 0.9974
=-3.14

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $24.3 Mil.
Revenue was 60.289 + 68.381 + 58.8 + 56.397 = $243.9 Mil.
Gross Profit was 3.858 + 8.631 + 5.093 + 2.156 = $19.7 Mil.
Total Current Assets was $88.4 Mil.
Total Assets was $158.8 Mil.
Property, Plant and Equipment(Net PPE) was $64.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $13.0 Mil.
Selling, General & Admin. Expense(SGA) was $21.9 Mil.
Total Current Liabilities was $56.9 Mil.
Long-Term Debt was $3.3 Mil.
Net Income was -1.814 + 1.86 + -1.043 + -3.746 = $-4.7 Mil.
Non Operating Income was 0.148 + -0.016 + 0.136 + 0.402 = $0.7 Mil.
Cash Flow from Operations was 17.635 + 1.571 + -12.117 + 4.747 = $11.8 Mil.
Accounts Receivable was $21.8 Mil.
Revenue was 60.862 + 52.945 + 45.506 + 44.908 = $204.2 Mil.
Gross Profit was 4.618 + 3.401 + 2.17 + 0.23 = $10.4 Mil.
Total Current Assets was $83.3 Mil.
Total Assets was $164.3 Mil.
Property, Plant and Equipment(Net PPE) was $72.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $15.7 Mil.
Selling, General & Admin. Expense(SGA) was $20.7 Mil.
Total Current Liabilities was $58.3 Mil.
Long-Term Debt was $4.2 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)
=(24.316 / 243.867) / (21.777 / 204.221)
=0.09971009 / 0.10663448
=0.9351

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)
=(8.631 / 204.221) / (3.858 / 243.867)
=0.05101826 / 0.08093756
=0.6303

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 - (88.411 + 64.3) / 158.796) / (1 - (83.341 + 72.761) / 164.31)
=0.03831961 / 0.04995435
=0.7671

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
=243.867 / 204.221
=1.1941

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))
=(15.722 / (15.722 + 72.761)) / (13.02 / (13.02 + 64.3))
=0.17768385 / 0.1683911
=1.0552

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)
=(21.859 / 243.867) / (20.697 / 204.221)
=0.08963492 / 0.10134609
=0.8844

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)
=((3.339 + 56.88) / 158.796) / ((4.188 + 58.287) / 164.31)
=0.3792224 / 0.3802264
=0.9974

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
=(-4.743 - 0.67 - 11.836) / 158.796
=-0.1086

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 -3.14 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 0.434611.42370.37180.6561.41260.87010.69830.9132
GMI 8.4542-0.92910.86072.57374.19710.36761.19190.5669
AQI 27.14444.17890.66110.60690.3040.88380.98490.8743
SGI 2.04527.40847.29170.91030.6921.35761.13371.0237
DEPI 0.80181.84580.43170.82651.18450.94380.82840.9689
SGAI 0.95910.50370.99540.92081.13720.70730.72510.9669
LVGI 1.16550.1660.77611.02510.97721.02790.83541.5037
TATA -0.5189-0.0156-0.0535-0.5154-0.3934-0.0675-0.113-0.2482
M-score 9.9313.472.10-4.63-2.80-2.94-2.99-4.14

Broadwind Energy Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.65850.93720.69831.10770.9430.82730.91320.79050.96290.9351
GMI 2.94292.30951.19191.03540.60680.67170.56690.50360.51190.6303
AQI 0.85370.94030.98490.85470.82090.92180.87431.08191.22210.7671
SGI 1.3281.29431.13371.02540.92820.92451.02371.1351.2321.1941
DEPI 0.78880.75990.82840.85970.82040.91830.96891.02191.13081.0552
SGAI 0.73270.73910.72510.79710.91250.96630.96690.91460.88110.8844
LVGI 1.08250.99870.83541.04781.00221.1831.50371.04060.93650.9974
TATA -0.06130.0002-0.113-0.1004-0.1971-0.3376-0.2482-0.1785-0.0515-0.1086
M-score -1.83-1.59-2.99-2.86-3.81-4.55-4.14-3.61-2.66-3.14
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