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ConAgra Foods Inc (NYSE:CAG)
Beneish M-Score
-3.45 (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.

ConAgra Foods Inc has a M-score of -3.45 suggests that the company is not a manipulator.

CAG' s Beneish M-Score Range Over the Past 10 Years
Min: -3.45   Max: -1.26
Current: -3.45

-3.45
-1.26

During the past 13 years, the highest Beneish M-Score of ConAgra Foods Inc was -1.26. The lowest was -3.45. And the median was -2.72.


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 ConAgra Foods 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 * 0.8816+0.528 * 0.9074+0.404 * 0.8237+0.892 * 0.9754+0.115 * 1.0373
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.4659+4.679 * -0.1407-0.327 * 0.9513
=-3.45

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

This Year (May16) TTM:Last Year (May15) TTM:
Accounts Receivable was $837 Mil.
Revenue was 2827.5 + 2924.1 + 3092.7 + 2793.8 = $11,638 Mil.
Gross Profit was 760.9 + 800.4 + 828 + 700.8 = $3,090 Mil.
Total Current Assets was $3,577 Mil.
Total Assets was $13,391 Mil.
Property, Plant and Equipment(Net PPE) was $2,710 Mil.
Depreciation, Depletion and Amortization(DDA) was $374 Mil.
Selling, General & Admin. Expense(SGA) was $2,209 Mil.
Total Current Liabilities was $2,532 Mil.
Long-Term Debt was $4,918 Mil.
Net Income was 117.6 + 204.6 + 154.9 + -1154.1 = $-677 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 512.3 + 377.1 + 251.2 + 66.8 = $1,207 Mil.
Accounts Receivable was $973 Mil.
Revenue was 3125.5 + 2907.3 + 3136.4 + 2763 = $11,932 Mil.
Gross Profit was 806.6 + 720 + 757.3 + 590.8 = $2,875 Mil.
Total Current Assets was $3,563 Mil.
Total Assets was $17,438 Mil.
Property, Plant and Equipment(Net PPE) was $2,645 Mil.
Depreciation, Depletion and Amortization(DDA) was $380 Mil.
Selling, General & Admin. Expense(SGA) was $1,545 Mil.
Total Current Liabilities was $3,310 Mil.
Long-Term Debt was $6,889 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)
=(836.6 / 11638.1) / (972.9 / 11932.2)
=0.07188459 / 0.08153568
=0.8816

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)
=(2874.7 / 11932.2) / (3090.1 / 11638.1)
=0.24091953 / 0.26551585
=0.9074

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 - (3576.7 + 2710.3) / 13390.6) / (1 - (3563.3 + 2644.6) / 17437.8)
=0.53049154 / 0.64399752
=0.8237

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
=11638.1 / 11932.2
=0.9754

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))
=(380.4 / (380.4 + 2644.6)) / (373.9 / (373.9 + 2710.3))
=0.12575207 / 0.12123079
=1.0373

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)
=(2209.4 / 11638.1) / (1545.3 / 11932.2)
=0.18984198 / 0.12950671
=1.4659

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)
=((4917.8 + 2532.4) / 13390.6) / ((6888.8 + 3310.1) / 17437.8)
=0.55637537 / 0.58487309
=0.9513

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
=(-677 - 0 - 1207.4) / 13390.6
=-0.1407

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.

ConAgra Foods Inc has a M-score of -3.45 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.

ConAgra Foods Inc Annual Data

May07May08May09May10May11May12May13May14May15May16
DSRI 0.66921.1270.77311.18550.9751.01161.36920.94120.91160.8816
GMI 0.93011.11511.04870.87931.08281.11610.84041.01031.02650.9075
AQI 0.95190.95771.24990.9430.9621.12941.2550.9861.08640.8237
SGI 1.03880.96491.0970.94881.02541.07631.01040.87891.00830.9754
DEPI 0.891.26960.96360.99320.9370.99931.18871.1280.70661.0373
SGAI 0.94790.95940.87481.13180.80321.22741.03250.97970.86151.4659
LVGI 1.00810.99810.8830.98710.97671.01461.35540.97670.99440.9513
TATA -0.01510.06060.075-0.0655-0.0469-0.051-0.0313-0.0655-0.0994-0.1407
M-score -2.88-2.03-2.07-2.77-2.64-2.57-2.36-2.92-2.98-3.45

ConAgra Foods Inc Quarterly Data

Feb14May14Aug14Nov14Feb15May15Aug15Nov15Feb16May16
DSRI 1.02970.94121.10581.24511.36240.9120.70520.61230.59350.8816
GMI 0.96421.01030.94580.91480.8961.02641.00381.00451.00820.9074
AQI 1.02780.9861.04861.03520.98021.08640.96470.97920.91690.8237
SGI 1.0160.87890.78410.68170.60461.00791.0991.21621.36250.9754
DEPI 0.74391.1281.36761.67422.25520.70660.63060.54990.44471.0373
SGAI 0.90070.97970.96810.97681.00580.86180.86670.94281.02781.4659
LVGI 0.93440.97670.93060.94431.01350.99441.14771.140.95780.9513
TATA -0.0381-0.0655-0.0514-0.0513-0.119-0.0994-0.2023-0.1954-0.1532-0.1407
M-score -2.62-2.92-2.75-2.71-2.98-2.98-3.69-3.65-3.33-3.45
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