Switch to:
GuruFocus has detected 5 Warning Signs with Carbo Ceramics Inc $CRR.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Carbo Ceramics Inc (NYSE:CRR)
Beneish M-Score
-3.63 (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.

Carbo Ceramics Inc has a M-score of -3.63 suggests that the company is not a manipulator.

CRR' s Beneish M-Score Range Over the Past 10 Years
Min: -6.03   Max: -1.33
Current: -3.63

-6.03
-1.33

During the past 13 years, the highest Beneish M-Score of Carbo Ceramics Inc was -1.33. The lowest was -6.03. And the median was -2.59.


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 Carbo Ceramics 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 * 1.3187+0.528 * 0.2433+0.404 * 1.0496+0.892 * 0.3686+0.115 * 1.0298
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.7226+4.679 * -0.0861-0.327 * 0.9431
=-3.63

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $23.6 Mil.
Revenue was 29.058 + 20.241 + 20.651 + 33.102 = $103.1 Mil.
Gross Profit was -20.495 + -20.865 + -20.012 + -23.641 = $-85.0 Mil.
Total Current Assets was $217.2 Mil.
Total Assets was $723.5 Mil.
Property, Plant and Equipment(Net PPE) was $494.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $48.5 Mil.
Selling, General & Admin. Expense(SGA) was $40.0 Mil.
Total Current Liabilities was $34.8 Mil.
Long-Term Debt was $67.4 Mil.
Net Income was -15.197 + -19.95 + -20.296 + -24.684 = $-80.1 Mil.
Non Operating Income was -0.004 + 0.05 + 0.008 + 0.076 = $0.1 Mil.
Cash Flow from Operations was -12.65 + -14.719 + 17.729 + -8.295 = $-17.9 Mil.
Accounts Receivable was $48.6 Mil.
Revenue was 56.768 + 75.807 + 73.252 + 73.747 = $279.6 Mil.
Gross Profit was -15.228 + -4.597 + -10.302 + -25.998 = $-56.1 Mil.
Total Current Assets was $285.3 Mil.
Total Assets was $836.4 Mil.
Property, Plant and Equipment(Net PPE) was $537.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $54.5 Mil.
Selling, General & Admin. Expense(SGA) was $63.0 Mil.
Total Current Liabilities was $70.3 Mil.
Long-Term Debt was $55.0 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)
=(23.622 / 103.052) / (48.596 / 279.574)
=0.22922408 / 0.1738216
=1.3187

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)
=(-56.125 / 279.574) / (-85.013 / 103.052)
=-0.20075186 / -0.82495245
=0.2433

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 - (217.223 + 494.103) / 723.457) / (1 - (285.277 + 537.731) / 836.369)
=0.0167681 / 0.01597501
=1.0496

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
=103.052 / 279.574
=0.3686

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))
=(54.457 / (54.457 + 537.731)) / (48.451 / (48.451 + 494.103))
=0.09195897 / 0.08930171
=1.0298

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)
=(40 / 103.052) / (62.996 / 279.574)
=0.38815355 / 0.22532854
=1.7226

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)
=((67.404 + 34.804) / 723.457) / ((55 + 70.29) / 836.369)
=0.14127723 / 0.1498023
=0.9431

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
=(-80.127 - 0.13 - -17.935) / 723.457
=-0.0861

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.

Carbo Ceramics Inc has a M-score of -3.63 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 local exchange's currency.

Carbo Ceramics Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.76560.991.02821.08620.94590.89351.17261.09020.851.3187
GMI 1.07781.0340.93220.95470.88271.20811.19731.0342-1.39280.2433
AQI 0.2260.97842.92820.84241.57630.65680.81640.90410.53491.0496
SGI 1.0571.29280.88151.38381.32261.03171.03390.97140.43120.3686
DEPI 0.86750.79681.0851.11260.90120.88171.05581.09940.89271.0298
SGAI 1.08640.99261.19720.94730.88230.99311.03281.10311.99171.7226
LVGI 0.86742.08850.41231.3521.24860.58881.02631.28481.80780.9431
TATA 0.00870.05440.0601-0.02110.0257-0.0619-0.0598-0.0531-0.2153-0.0861
M-score -2.86-2.34-1.37-2.34-2.02-2.75-2.55-2.79-6.03-3.63

Carbo Ceramics Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 0.73541.09020.74810.77150.8790.852.1870.80090.96781.3187
GMI 0.991.03421.50853.0316516.987-1.3928-0.8594-0.2932-0.00090.2433
AQI 0.99040.90411.1121.08180.94130.53490.50350.54580.49171.0496
SGI 0.98260.97140.85820.68030.60550.43120.41660.39630.33480.3686
DEPI 1.1691.09941.03640.9360.92050.89270.89860.94470.96571.0298
SGAI 1.10511.10091.241.37871.47971.9971.91121.9762.2351.7226
LVGI 0.9921.28481.70872.23381.84861.80781.02331.02780.97120.9431
TATA -0.0962-0.0537-0.1128-0.1469-0.1488-0.2153-0.1513-0.1745-0.149-0.0861
M-score -3.19-2.79-3.32-3.03268.41-6.03-3.97-5.07-4.74-3.63
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)
FEEDBACK