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Enbridge Energy Partners LP (NYSE:EEP)
Beneish M-Score
-3.12 (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.

Enbridge Energy Partners LP has a M-score of -3.12 suggests that the company is not a manipulator.

EEP' s 10-Year Beneish M-Score Range
Min: -3.27   Max: 2.72
Current: -3.12

-3.27
2.72

During the past 13 years, the highest Beneish M-Score of Enbridge Energy Partners LP was 2.72. The lowest was -3.27. And the median was -2.53.


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 Enbridge Energy Partners LP 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 * 0.3306+0.528 * 1.0737+0.404 * 1.0685+0.892 * 1.1404+0.115 * 1.0772
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9977+4.679 * -0.0633-0.327 * 0.7787
=-3.12

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $236 Mil.
Revenue was 2079.6 + 1962 + 1789.4 + 1672.7 = $7,504 Mil.
Gross Profit was 535.5 + 472.9 + 488.3 + 522.8 = $2,020 Mil.
Total Current Assets was $575 Mil.
Total Assets was $15,353 Mil.
Property, Plant and Equipment(Net PPE) was $13,750 Mil.
Depreciation, Depletion and Amortization(DDA) was $400 Mil.
Selling, General & Admin. Expense(SGA) was $967 Mil.
Total Current Liabilities was $1,919 Mil.
Long-Term Debt was $5,083 Mil.
Net Income was 93.3 + -16.8 + 14.9 + 89.9 = $181 Mil.
Non Operating Income was 19.9 + -85.3 + 9.7 + -8.4 = $-64 Mil.
Cash Flow from Operations was 210.8 + 269.9 + 465 + 271.6 = $1,217 Mil.
Accounts Receivable was $626 Mil.
Revenue was 1693 + 1771.2 + 1564.3 + 1551.1 = $6,580 Mil.
Gross Profit was 289.5 + 483.4 + 612.6 + 515.8 = $1,901 Mil.
Total Current Assets was $997 Mil.
Total Assets was $13,080 Mil.
Property, Plant and Equipment(Net PPE) was $11,264 Mil.
Depreciation, Depletion and Amortization(DDA) was $353 Mil.
Selling, General & Admin. Expense(SGA) was $850 Mil.
Total Current Liabilities was $1,706 Mil.
Long-Term Debt was $5,954 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)
=(236.1 / 7503.7) / (626.2 / 6579.6)
=0.03146448 / 0.09517296
=0.3306

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)
=(472.9 / 6579.6) / (535.5 / 7503.7)
=0.28896893 / 0.26913389
=1.0737

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 - (575 + 13749.8) / 15352.9) / (1 - (996.5 + 11263.7) / 13079.9)
=0.06696455 / 0.06266867
=1.0685

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
=7503.7 / 6579.6
=1.1404

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))
=(353.4 / (353.4 + 11263.7)) / (399.6 / (399.6 + 13749.8))
=0.03042067 / 0.02824148
=1.0772

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)
=(967.2 / 7503.7) / (850 / 6579.6)
=0.12889641 / 0.12918718
=0.9977

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)
=((5082.6 + 1918.6) / 15352.9) / ((5953.9 + 1706.1) / 13079.9)
=0.45601808 / 0.58563139
=0.7787

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
=(181.3 - -64.1 - 1217.3) / 15352.9
=-0.0633

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.

Enbridge Energy Partners LP has a M-score of -3.12 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.

Enbridge Energy Partners LP Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.14271.04980.91021.05630.61091.61051.07680.7381.31020.3825
GMI 1.07811.49260.72391.080.9580.53141.86990.59140.71911.2507
AQI 0.86070.86140.90960.73350.99870.8181.24190.96871.12111.1667
SGI 1.35291.50921.0051.11891.35920.5791.34971.17760.73611.0613
DEPI 0.91410.96811.25871.17850.90010.95370.97011.00041.1371.0684
SGAI 0.95660.791.11081.06410.8691.83870.7821.03851.64171.0452
LVGI 1.04341.06420.9671.03080.90530.99891.14030.94170.96120.8148
TATA -0.0256-0.0454-0.0087-0.0315-0.0171-0.0473-0.0569-0.0377-0.0272-0.0771
M-score -2.19-1.98-2.76-2.54-2.58-2.99-1.82-2.95-2.74-3.09

Enbridge Energy Partners LP Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.7380.72120.75980.93361.31021.34040.88870.36570.38250.3306
GMI 0.60040.58920.50140.59210.70820.81140.92741.21921.25071.0737
AQI 0.96870.98791.05221.01641.12111.1391.25271.28461.16671.0685
SGI 1.17761.06750.89690.7620.73610.76150.8570.98781.06131.1404
DEPI 1.00041.0871.15521.14041.1371.10611.06811.0751.06841.0772
SGAI 1.04051.12641.34021.55271.64171.51911.30031.1431.04520.9977
LVGI 0.94170.94580.95480.9360.96121.0080.78260.82210.81480.7787
TATA -0.0377-0.0389-0.0319-0.0365-0.0272-0.0373-0.0516-0.0723-0.076-0.0633
M-score -2.95-3.07-3.21-3.19-2.74-2.68-2.86-3.14-3.09-3.12
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