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Broadwind Energy Inc (NAS:BWEN)
Beneish M-Score
-2.35 (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 -2.35 suggests that the company is not a manipulator.

BWEN' s 10-Year Beneish M-Score Range
Min: -5.73   Max: 16.14
Current: -2.35

-5.73
16.14

During the past 13 years, the highest Beneish M-Score of Broadwind Energy Inc was 16.14. The lowest was -5.73. And the median was -2.69.


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 * 0.9147+0.528 * 1.6456+0.404 * 0.8206+0.892 * 0.9424+0.115 * 1.0431
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9697+4.679 * -0.0046-0.327 * 0.9812
=-2.35

* 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 $21.3 Mil.
Revenue was 65.225 + 51.051 + 53.798 + 60.289 = $230.4 Mil.
Gross Profit was 7.234 + 0.739 + -0.092 + 3.858 = $11.7 Mil.
Total Current Assets was $67.7 Mil.
Total Assets was $132.1 Mil.
Property, Plant and Equipment(Net PPE) was $58.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $11.0 Mil.
Selling, General & Admin. Expense(SGA) was $20.5 Mil.
Total Current Liabilities was $36.4 Mil.
Long-Term Debt was $7.0 Mil.
Net Income was 1.615 + -5.015 + -5.171 + -1.814 = $-10.4 Mil.
Non Operating Income was -0.044 + 0.212 + -0.006 + 0.148 = $0.3 Mil.
Cash Flow from Operations was -3.093 + -20.038 + -4.588 + 17.635 = $-10.1 Mil.
Accounts Receivable was $24.7 Mil.
Revenue was 68.381 + 58.8 + 56.397 + 60.862 = $244.4 Mil.
Gross Profit was 8.631 + 5.093 + 2.156 + 4.618 = $20.5 Mil.
Total Current Assets was $76.7 Mil.
Total Assets was $150.9 Mil.
Property, Plant and Equipment(Net PPE) was $66.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $13.1 Mil.
Selling, General & Admin. Expense(SGA) was $22.4 Mil.
Total Current Liabilities was $47.3 Mil.
Long-Term Debt was $3.3 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)
=(21.323 / 230.363) / (24.736 / 244.44)
=0.09256261 / 0.10119457
=0.9147

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)
=(0.739 / 244.44) / (7.234 / 230.363)
=0.08385698 / 0.0509587
=1.6456

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 - (67.696 + 58.721) / 132.061) / (1 - (76.666 + 66.336) / 150.859)
=0.04273783 / 0.05208175
=0.8206

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
=230.363 / 244.44
=0.9424

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))
=(13.087 / (13.087 + 66.336)) / (11.016 / (11.016 + 58.721))
=0.16477595 / 0.15796493
=1.0431

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)
=(20.512 / 230.363) / (22.446 / 244.44)
=0.08904208 / 0.09182622
=0.9697

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)
=((7.029 + 36.444) / 132.061) / ((3.335 + 47.28) / 150.859)
=0.32918878 / 0.33551197
=0.9812

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
=(-10.385 - 0.31 - -10.084) / 132.061
=-0.0046

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 -2.35 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.437311.35270.37180.70221.31960.87010.69830.91320.955
GMI 5.227-1.50270.86072.38374.53150.36761.19190.56690.7895
AQI 27.14444.17890.66110.60690.3040.88380.98490.87430.7985
SGI 2.04527.40847.29170.85030.74081.35761.13371.02371.1185
DEPI 0.79961.85830.430.91931.06490.94380.82840.96891.0916
SGAI 0.78220.61760.99540.91781.1410.70730.72510.96690.8843
LVGI 1.16550.16670.76851.03030.97721.02790.83541.50370.948
TATA -0.5189-0.0187-0.0598-0.5198-0.3971-0.0675-0.113-0.2482-0.0609
M-score 8.2613.072.07-4.75-2.70-2.94-2.99-4.14-2.85

Broadwind Energy Inc Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.10770.9430.82730.91320.79050.96290.93510.9550.9060.9147
GMI 1.03540.60680.67170.56690.50360.51190.63030.78951.18521.6456
AQI 0.85470.82090.92180.87431.08191.22210.76710.79850.80120.8206
SGI 1.02540.92820.92451.02371.1351.2321.19411.11851.01970.9424
DEPI 0.85970.82040.91830.96891.02191.13081.05521.09161.07241.0431
SGAI 0.79710.91250.96630.96690.91460.88110.88440.88430.93270.9697
LVGI 1.04781.00221.1831.50371.04060.93650.99740.9481.0230.9812
TATA -0.1004-0.1971-0.3376-0.2482-0.1785-0.0515-0.1086-0.0609-0.0368-0.0046
M-score -2.86-3.81-4.55-4.14-3.61-2.66-3.14-2.85-2.69-2.35
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