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Cantel Medical Corp (NYSE:CMN)
Beneish M-Score
-2.45 (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.

Cantel Medical Corp has a M-score of -2.45 suggests that the company is not a manipulator.

CMN' s Beneish M-Score Range Over the Past 10 Years
Min: -3.19   Max: 0.34
Current: -2.45

-3.19
0.34

During the past 13 years, the highest Beneish M-Score of Cantel Medical Corp was 0.34. The lowest was -3.19. And the median was -2.44.


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 Cantel Medical Corp 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 * 1.0092+0.528 * 0.9652+0.404 * 1.0343+0.892 * 1.1549+0.115 * 0.9585
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0095+4.679 * -0.0166-0.327 * 1.0825
=-2.45

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

This Year (Jan16) TTM:Last Year (Jan15) TTM:
Accounts Receivable was $76.0 Mil.
Revenue was 158.271 + 153.779 + 151.255 + 141.508 = $604.8 Mil.
Gross Profit was 72.337 + 71.198 + 68.763 + 63.599 = $275.9 Mil.
Total Current Assets was $196.5 Mil.
Total Assets was $663.3 Mil.
Property, Plant and Equipment(Net PPE) was $70.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $25.0 Mil.
Selling, General & Admin. Expense(SGA) was $170.2 Mil.
Total Current Liabilities was $66.1 Mil.
Long-Term Debt was $133.5 Mil.
Net Income was 15.389 + 14.254 + 13.273 + 12.356 = $55.3 Mil.
Non Operating Income was 0 + 0 + 0 + -2.206 = $-2.2 Mil.
Cash Flow from Operations was 13.156 + 15.115 + 25.696 + 14.536 = $68.5 Mil.
Accounts Receivable was $65.2 Mil.
Revenue was 135.43 + 136.811 + 131.377 + 120.058 = $523.7 Mil.
Gross Profit was 60.591 + 60.514 + 57.047 + 52.418 = $230.6 Mil.
Total Current Assets was $178.0 Mil.
Total Assets was $567.7 Mil.
Property, Plant and Equipment(Net PPE) was $61.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $20.7 Mil.
Selling, General & Admin. Expense(SGA) was $146.0 Mil.
Total Current Liabilities was $62.3 Mil.
Long-Term Debt was $95.5 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)
=(76.016 / 604.813) / (65.217 / 523.676)
=0.12568513 / 0.12453693
=1.0092

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)
=(71.198 / 523.676) / (72.337 / 604.813)
=0.44029133 / 0.4561691
=0.9652

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 - (196.546 + 69.995) / 663.328) / (1 - (177.961 + 61.408) / 567.675)
=0.59817617 / 0.57833443
=1.0343

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
=604.813 / 523.676
=1.1549

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))
=(20.715 / (20.715 + 61.408)) / (25 / (25 + 69.995))
=0.25224359 / 0.26317175
=0.9585

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)
=(170.216 / 604.813) / (145.993 / 523.676)
=0.28143575 / 0.27878497
=1.0095

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)
=((133.5 + 66.107) / 663.328) / ((95.5 + 62.307) / 567.675)
=0.30091749 / 0.27798829
=1.0825

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
=(55.272 - -2.206 - 68.503) / 663.328
=-0.0166

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.

Cantel Medical Corp has a M-score of -2.45 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.

Cantel Medical Corp Annual Data

Jul06Jul07Jul08Jul09Jul10Jul11Jul12Jul13Jul14Jul15
DSRI 1.16851.1260.87480.96320.99351.23260.86570.99991.02580.9704
GMI 1.07230.99851.02650.91860.94441.06120.89870.9840.98910.9728
AQI 1.67451.13910.99750.98090.97511.01781.08541.00451.00030.9571
SGI 0.97351.13981.13851.04281.05351.17411.20161.09971.14991.156
DEPI 0.87011.00610.91150.98380.98020.92340.98220.99731.0270.9523
SGAI 1.08991.03161.00590.98451.03010.98751.00880.98171.0311.0434
LVGI 1.16651.0750.96890.81550.71071.13231.4820.95110.92760.9313
TATA 0.02110.0198-0.0206-0.0555-0.0324-0.0242-0.0429-0.0251-0.0392-0.0153
M-score -2.02-2.12-2.56-2.72-2.54-2.23-2.80-2.50-2.49-2.46

Cantel Medical Corp Quarterly Data

Oct13Jan14Apr14Jul14Oct14Jan15Apr15Jul15Oct15Jan16
DSRI 1.04691.01061.00911.02580.97160.94791.04770.97041.00591.0092
GMI 1.00330.99690.99220.98910.98370.98770.98250.97280.96550.9652
AQI 0.99960.99040.98481.00031.0020.95670.97340.95711.00891.0343
SGI 1.12911.13511.15031.14991.14351.14771.15651.1561.14721.1549
DEPI 0.990.95020.98021.0271.02381.09931.04020.95231.02940.9585
SGAI 0.9991.03341.03191.0311.04061.0431.04131.04341.03451.0095
LVGI 0.94070.78680.73790.92761.03781.12351.18010.93131.16481.0825
TATA -0.0248-0.0253-0.03-0.0392-0.041-0.0322-0.0161-0.0153-0.0123-0.0166
M-score -2.42-2.42-2.41-2.49-2.59-2.61-2.45-2.46-2.47-2.45
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