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ConAgra Foods Inc (NYSE:CAG)
Beneish M-Score
-3.03 (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 -3.03 suggests that the company is not a manipulator.

CAG' s 10-Year Beneish M-Score Range
Min: -3.03   Max: -1.27
Current: -3.03

-3.03
-1.27

During the past 13 years, the highest Beneish M-Score of ConAgra Foods Inc was -1.27. The lowest was -3.03. And the median was -2.68.


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 * 0.9199+0.528 * 1.0607+0.404 * 0.9872+0.892 * 0.9993+0.115 * 0.9717
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.2538+4.679 * -0.0988-0.327 * 0.9885
=-3.03

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

This Year (May15) TTM:Last Year (May14) TTM:
Accounts Receivable was $973 Mil.
Revenue was 4104.7 + 3876.7 + 4150 + 3701 = $15,832 Mil.
Gross Profit was 892.4 + 823.8 + 888.5 + 703.8 = $3,309 Mil.
Total Current Assets was $3,668 Mil.
Total Assets was $17,542 Mil.
Property, Plant and Equipment(Net PPE) was $3,608 Mil.
Depreciation, Depletion and Amortization(DDA) was $592 Mil.
Selling, General & Admin. Expense(SGA) was $3,472 Mil.
Total Current Liabilities was $3,310 Mil.
Long-Term Debt was $6,889 Mil.
Net Income was 209.2 + -954.1 + 10 + 482.3 = $-253 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 740.1 + 322.8 + 184.1 + 233.6 = $1,481 Mil.
Accounts Receivable was $1,058 Mil.
Revenue was 3959.4 + 3947.3 + 4221.1 + 3715.8 = $15,844 Mil.
Gross Profit was 836.9 + 923.1 + 959.8 + 792.1 = $3,512 Mil.
Total Current Assets was $4,231 Mil.
Total Assets was $19,320 Mil.
Property, Plant and Equipment(Net PPE) was $3,636 Mil.
Depreciation, Depletion and Amortization(DDA) was $577 Mil.
Selling, General & Admin. Expense(SGA) was $2,771 Mil.
Total Current Liabilities was $2,642 Mil.
Long-Term Debt was $8,721 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)
=(972.9 / 15832.4) / (1058.4 / 15843.6)
=0.06144994 / 0.066803
=0.9199

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)
=(823.8 / 15843.6) / (892.4 / 15832.4)
=0.22166048 / 0.20897021
=1.0607

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 - (3667.7 + 3608.1) / 17542.2) / (1 - (4230.8 + 3636) / 19319.5)
=0.58524016 / 0.5928052
=0.9872

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
=15832.4 / 15843.6
=0.9993

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))
=(577.3 / (577.3 + 3636)) / (592.3 / (592.3 + 3608.1))
=0.13701849 / 0.14101038
=0.9717

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)
=(3472.1 / 15832.4) / (2771.2 / 15843.6)
=0.21930345 / 0.17490974
=1.2538

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)
=((6888.9 + 3310.2) / 17542.2) / ((8720.5 + 2642.4) / 19319.5)
=0.5814037 / 0.58815704
=0.9885

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
=(-252.6 - 0 - 1480.6) / 17542.2
=-0.0988

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 -3.03 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

May06May07May08May09May10May11May12May13May14May15
DSRI 1.03760.67670.99040.78921.16330.96981.00881.19880.80550.9199
GMI 1.00410.96951.08941.04840.87871.08721.11370.91121.04171.0607
AQI 0.90660.95190.95771.24990.9430.9621.12941.2550.9860.9872
SGI 0.90051.02731.0981.07460.96691.03091.07931.1541.0270.9993
DEPI 0.92540.88621.23780.99320.96890.93010.99721.13130.77030.9717
SGAI 1.19090.93730.90570.8881.11760.79921.22610.93341.26291.2538
LVGI 0.95411.00810.99810.8830.98710.97671.01461.35540.97670.9885
TATA -0.0672-0.01750.05760.075-0.0636-0.0469-0.051-0.0313-0.0655-0.0988
M-score -2.91-2.88-2.06-2.07-2.76-2.63-2.57-2.34-2.99-3.03

ConAgra Foods Inc Quarterly Data

Feb13May13Aug13Nov13Feb14May14Aug14Nov14Feb15May15
DSRI 1.19391.19881.10711.15710.90950.80550.86760.87980.86360.9199
GMI 0.93370.91121.03361.04991.03681.04171.01741.03141.06611.0607
AQI 1.28341.2551.24461.28641.02780.9861.04861.03520.98020.9872
SGI 1.08111.1541.16771.17851.15031.0270.99930.96470.95380.9993
DEPI 1.32081.13131.05220.97690.71720.77030.81250.84990.9180.9717
SGAI 1.48210.93340.93940.93050.82071.26291.22611.31851.9461.2538
LVGI 1.46871.35541.31231.25580.93440.97670.93060.94431.01350.9885
TATA -0.0265-0.0313-0.0286-0.039-0.0381-0.0655-0.0514-0.0513-0.119-0.0988
M-score -2.47-2.34-2.33-2.29-2.56-2.99-2.85-2.89-3.35-3.03
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