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EMCOR Group, Inc. (NYSE:EME)
Beneish M-Score
-2.68 (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.

EMCOR Group, Inc. has a M-score of -2.68 suggests that the company is not a manipulator.

EME' s 10-Year Beneish M-Score Range
Min: -3.12   Max: -1.68
Current: -2.68

-3.12
-1.68

During the past 13 years, the highest Beneish M-Score of EMCOR Group, Inc. was -1.68. The lowest was -3.12. And the median was -2.48.


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 EMCOR Group, 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 * 0.9642+0.528 * 0.9095+0.404 * 0.9994+0.892 * 1.0093+0.115 * 0.932
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.061+4.679 * -0.023-0.327 * 1.0013
=-2.68

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $1,234 Mil.
Revenue was 1714.796 + 1566.711 + 1558.055 + 1599.385 = $6,439 Mil.
Gross Profit was 248.573 + 222.229 + 219.635 + 215.211 = $906 Mil.
Total Current Assets was $1,887 Mil.
Total Assets was $3,389 Mil.
Property, Plant and Equipment(Net PPE) was $122 Mil.
Depreciation, Depletion and Amortization(DDA) was $74 Mil.
Selling, General & Admin. Expense(SGA) was $629 Mil.
Total Current Liabilities was $1,283 Mil.
Long-Term Debt was $316 Mil.
Net Income was 42.466 + 45.024 + 39.913 + 41.261 = $169 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 137.663 + 69.354 + 63.956 + -24.316 = $247 Mil.
Accounts Receivable was $1,268 Mil.
Revenue was 1649.279 + 1605.315 + 1556.753 + 1568.401 = $6,380 Mil.
Gross Profit was 236.871 + 206.562 + 181.535 + 191.138 = $816 Mil.
Total Current Assets was $1,930 Mil.
Total Assets was $3,466 Mil.
Property, Plant and Equipment(Net PPE) was $123 Mil.
Depreciation, Depletion and Amortization(DDA) was $67 Mil.
Selling, General & Admin. Expense(SGA) was $587 Mil.
Total Current Liabilities was $1,299 Mil.
Long-Term Debt was $335 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)
=(1234.187 / 6438.947) / (1268.226 / 6379.748)
=0.19167528 / 0.19878936
=0.9642

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)
=(222.229 / 6379.748) / (248.573 / 6438.947)
=0.12792135 / 0.14065157
=0.9095

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 - (1886.603 + 122.178) / 3388.967) / (1 - (1930.105 + 123.414) / 3465.915)
=0.40725861 / 0.40751028
=0.9994

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
=6438.947 / 6379.748
=1.0093

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))
=(67.338 / (67.338 + 123.414)) / (74.49 / (74.49 + 122.178))
=0.35301334 / 0.37876014
=0.932

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)
=(628.607 / 6438.947) / (587.02 / 6379.748)
=0.09762575 / 0.09201304
=1.061

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)
=((316.399 + 1283.417) / 3388.967) / ((335.331 + 1298.743) / 3465.915)
=0.47206597 / 0.47146973
=1.0013

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
=(168.664 - 0 - 246.657) / 3388.967
=-0.023

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.

EMCOR Group, Inc. has a M-score of -2.68 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.

EMCOR Group, Inc. Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.99711.1930.98090.76890.92951.180.94110.90991.040.9593
GMI 0.89280.93730.95040.90740.87891.04021.09321.02910.97940.9187
AQI 1.04250.92891.65481.02541.00780.81451.29890.94051.33850.9994
SGI 0.97761.06721.20921.14480.81760.87461.15691.13060.99791.0144
DEPI 0.92051.13910.92870.92711.00631.03380.92821.00780.97240.932
SGAI 1.05731.00650.94691.0121.14030.99430.94850.94951.0461.0636
LVGI 0.91920.98411.04630.93111.04370.85310.98050.94681.01121.0013
TATA -0.0442-0.0601-0.0814-0.0504-0.0665-0.0596-0.0062-0.0122-0.0076-0.023
M-score -2.74-2.57-2.47-2.83-3.12-2.71-2.25-2.49-2.37-2.67

EMCOR Group, Inc. Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 0.9630.90990.98411.04630.99791.03250.99320.92080.95460.9642
GMI 1.05471.02911.00511.00010.99490.99320.97740.92580.90790.9095
AQI 0.92560.94050.94370.92661.29551.33851.32391.36420.99980.9994
SGI 1.15871.13061.08321.0351.01431.00521.00541.01081.00491.0093
DEPI 1.00321.00780.96810.98851.00070.97240.94550.91560.88670.932
SGAI 0.95850.94950.96010.98421.02321.04991.05361.06511.06721.061
LVGI 0.98030.94680.93620.96771.03041.01121.02020.98060.94461.0013
TATA 0.001-0.01220.009-0.0018-0.0243-0.0076-0.0252-0.0259-0.0055-0.023
M-score -2.36-2.49-2.37-2.43-2.48-2.36-2.50-2.57-2.60-2.68
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