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Ennis Inc (NYSE:EBF)
Beneish M-Score
-2.67 (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.

Ennis Inc has a M-score of -2.74 suggests that the company is not a manipulator.

EBF' s 10-Year Beneish M-Score Range
Min: -3.9   Max: -1.49
Current: -2.67

-3.9
-1.49

During the past 13 years, the highest Beneish M-Score of Ennis Inc was -1.49. The lowest was -3.90. And the median was -2.47.


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 Ennis 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 * 1.0429+0.528 * 0.8779+0.404 * 1.0144+0.892 * 1.0167+0.115 * 1.2691
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0178+4.679 * -0.0354-0.327 * 1.3537
=-2.74

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

This Year (Feb14) TTM:Last Year (Feb13) TTM:
Accounts Receivable was $63.7 Mil.
Revenue was 132.138 + 136.55 + 135.288 + 138.466 = $542.4 Mil.
Gross Profit was 33.58 + 37.759 + 36.659 + 35.795 = $143.8 Mil.
Total Current Assets was $214.1 Mil.
Total Assets was $536.3 Mil.
Property, Plant and Equipment(Net PPE) was $91.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $10.1 Mil.
Selling, General & Admin. Expense(SGA) was $86.7 Mil.
Total Current Liabilities was $41.9 Mil.
Long-Term Debt was $105.5 Mil.
Net Income was -14.467 + 9.349 + 9.801 + 8.506 = $13.2 Mil.
Non Operating Income was -0.414 + -0.253 + -0.053 + 0.157 = $-0.6 Mil.
Cash Flow from Operations was -5.816 + -1.533 + 18.553 + 21.551 = $32.8 Mil.
Accounts Receivable was $60.1 Mil.
Revenue was 123.638 + 128.996 + 138.344 + 142.528 = $533.5 Mil.
Gross Profit was 31.343 + 30.611 + 33.949 + 28.249 = $124.2 Mil.
Total Current Assets was $193.4 Mil.
Total Assets was $495.3 Mil.
Property, Plant and Equipment(Net PPE) was $91.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $13.2 Mil.
Selling, General & Admin. Expense(SGA) was $83.8 Mil.
Total Current Liabilities was $43.0 Mil.
Long-Term Debt was $57.5 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)
=(63.695 / 542.442) / (60.071 / 533.506)
=0.11742269 / 0.11259667
=1.0429

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)
=(37.759 / 533.506) / (33.58 / 542.442)
=0.23270966 / 0.26508456
=0.8779

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 - (214.143 + 91.565) / 536.347) / (1 - (193.416 + 91.913) / 495.292)
=0.43001825 / 0.42391761
=1.0144

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
=542.442 / 533.506
=1.0167

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))
=(13.235 / (13.235 + 91.913)) / (10.081 / (10.081 + 91.565))
=0.1258702 / 0.09917754
=1.2691

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)
=(86.673 / 542.442) / (83.757 / 533.506)
=0.15978298 / 0.15699355
=1.0178

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)
=((105.5 + 41.877) / 536.347) / ((57.5 + 43.039) / 495.292)
=0.2747792 / 0.20298935
=1.3537

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
=(13.189 - -0.563 - 32.755) / 536.347
=-0.0354

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.

Ennis Inc has a M-score of -2.74 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.

Ennis Inc Annual Data

Feb05Feb06Feb07Feb08Feb09Feb10Feb11Feb12Feb13Feb14
DSRI 1.10870.58321.08521.46370.83131.12380.95961.07170.9902
GMI 1.0640.9781.01770.99841.01760.93990.93041.11281.0848
AQI 1.94550.99151.00160.94850.87411.0140.90030.96071.0576
SGI 1.40871.53111.04531.04430.95650.88651.06230.941.0319
DEPI 1.19660.62771.04611.06671.07981.25361.46850.93730.8519
SGAI 0.94280.89440.99321.02191.16131.0041.02651.00381.0279
LVGI 1.80770.86640.85630.96110.99050.76960.9681.28620.77
TATA 0.0046-0.0145-0.01680.0267-0.1773-0.10880.02540.0128-0.0505
M-score -1.81-2.45-2.38-1.89-3.56-2.90-2.36-2.47-2.58

Ennis Inc Quarterly Data

Nov11Feb12May12Aug12Nov12Feb13May13Aug13Nov13Feb14
DSRI 0.89071.07171.16691.2471.21770.99021.05990.92531.061.0429
GMI 1.06321.11281.19311.19551.18371.08480.92710.88840.84710.8779
AQI 0.95620.96071.02771.04021.04941.05761.0341.02111.08591.0144
SGI 0.97580.940.93440.97111.00851.03191.02551.00411.00481.0167
DEPI 1.09480.93730.90060.91350.91160.85190.9070.92340.98581.2691
SGAI 1.00921.00381.02961.04951.0531.02791.02141.0041.00611.0178
LVGI 0.88471.28621.14831.11521.03640.770.71510.72991.27221.3537
TATA 0.01750.0128-0.0093-0.0387-0.0338-0.0505-0.0551-0.0594-0.0231-0.0354
M-score -2.46-2.47-2.38-2.40-2.34-2.58-2.61-2.79-2.67-2.74
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