Switch to:
ConAgra Foods Inc (NYSE:CAG)
Beneish M-Score
-2.70 (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 -2.70 suggests that the company is not a manipulator.

CAG' s 10-Year Beneish M-Score Range
Min: -2.95   Max: -1.81
Current: -2.7

-2.95
-1.81

During the past 13 years, the highest Beneish M-Score of ConAgra Foods Inc was -1.81. The lowest was -2.95. And the median was -2.64.


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 * 0.9458+0.528 * 1.0941+0.404 * 0.9807+0.892 * 1.1452+0.115 * 0.7574
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1318+4.679 * -0.0644-0.327 * 0.9783
=-2.70

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

This Year (May14) TTM:Last Year (May13) TTM:
Accounts Receivable was $1,393 Mil.
Revenue was 4435.5 + 4389.7 + 4713.9 + 4201.8 = $17,741 Mil.
Gross Profit was 905.5 + 975.2 + 1014.7 + 830.9 = $3,726 Mil.
Total Current Assets was $4,231 Mil.
Total Assets was $19,366 Mil.
Property, Plant and Equipment(Net PPE) was $3,812 Mil.
Depreciation, Depletion and Amortization(DDA) was $603 Mil.
Selling, General & Admin. Expense(SGA) was $2,768 Mil.
Total Current Liabilities was $2,642 Mil.
Long-Term Debt was $8,768 Mil.
Net Income was -324.2 + 234.3 + 248.7 + 144.3 = $303 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 608.9 + 386.6 + 389.6 + 166.1 = $1,551 Mil.
Accounts Receivable was $1,286 Mil.
Revenue was 4593.5 + 3850.5 + 3735.5 + 3311.9 = $15,491 Mil.
Gross Profit was 951.8 + 874 + 862.9 + 871.3 = $3,560 Mil.
Total Current Assets was $4,380 Mil.
Total Assets was $20,405 Mil.
Property, Plant and Equipment(Net PPE) was $3,859 Mil.
Depreciation, Depletion and Amortization(DDA) was $445 Mil.
Selling, General & Admin. Expense(SGA) was $2,136 Mil.
Total Current Liabilities was $3,401 Mil.
Long-Term Debt was $8,887 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)
=(1393.2 / 17740.9) / (1286.2 / 15491.4)
=0.0785304 / 0.08302671
=0.9458

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)
=(975.2 / 15491.4) / (905.5 / 17740.9)
=0.22980492 / 0.21004008
=1.0941

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 - (4230.8 + 3811.9) / 19366.4) / (1 - (4379.8 + 3859.2) / 20405.3)
=0.58470857 / 0.59623235
=0.9807

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
=17740.9 / 15491.4
=1.1452

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))
=(445.2 / (445.2 + 3859.2)) / (602.9 / (602.9 + 3811.9))
=0.10342905 / 0.13656338
=0.7574

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)
=(2768 / 17740.9) / (2135.6 / 15491.4)
=0.15602365 / 0.13785713
=1.1318

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)
=((8767.6 + 2642.4) / 19366.4) / ((8886.9 + 3401.3) / 20405.3)
=0.58916474 / 0.60220629
=0.9783

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
=(303.1 - 0 - 1551.2) / 19366.4
=-0.0644

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 -2.70 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

May05May06May07May08May09May10May11May12May13May14
DSRI 0.93041.14980.98080.76720.79981.14590.98161.011.19070.9479
GMI 1.03350.87750.93011.11511.04870.87931.07161.1110.92751.0929
AQI 0.97160.9670.92970.98061.23210.95380.96621.12941.24460.9807
SGI 1.00310.79491.03880.96491.0970.94881.01851.0781.16811.1427
DEPI 0.99370.91170.92741.21830.98810.97340.92980.99721.15450.7574
SGAI 1.00871.32860.94790.95940.87481.13180.81521.22640.91521.1339
LVGI 0.9050.97061.00830.99790.88410.98580.97671.01461.35540.9783
TATA -0.0613-0.0679-0.01890.05690.075-0.0655-0.0469-0.051-0.0313-0.0644
M-score -2.79-2.98-2.62-2.37-2.05-2.80-2.64-2.57-2.32-2.70

ConAgra Foods Inc Quarterly Data

Feb12May12Aug12Nov12Feb13May13Aug13Nov13Feb14May14
DSRI 0.99181.010.97230.98791.17411.19071.06561.08660.83650.9458
GMI 1.11111.1110.99230.96360.95250.92751.06841.09551.09041.0941
AQI 1.07251.12941.13081.06711.28341.24461.24461.28641.02780.9807
SGI 1.08651.0781.07531.08081.09931.16811.21321.25481.25071.1452
DEPI 0.93740.99721.03461.06551.31131.15451.03630.95320.69730.7574
SGAI 0.78211.22641.2381.23431.39650.91520.91060.89220.781.1318
LVGI 0.94821.01461.02291.05931.46871.35541.31231.25580.93440.9783
TATA -0.0347-0.051-0.0359-0.0294-0.0253-0.0313-0.0286-0.0377-0.0369-0.0644
M-score -2.44-2.57-2.60-2.60-2.45-2.32-2.31-2.25-2.50-2.70
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK