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Energy Transfer Partners LP (NYSE:ETP)
Beneish M-Score
-2.04 (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.

Energy Transfer Partners LP has a M-score of -2.04 signals that the company is a manipulator.

ETP' s 10-Year Beneish M-Score Range
Min: -30.34   Max: 4.34
Current: -2.04

-30.34
4.34

During the past 13 years, the highest Beneish M-Score of Energy Transfer Partners LP was 4.34. The lowest was -30.34. And the median was -2.18.


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 Energy Transfer 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 * 0.6034+0.528 * 1.4811+0.404 * 0.928+0.892 * 1.8911+0.115 * 0.781
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.468+4.679 * -0.054-0.327 * 1.0998
=-2.04

* 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 $4,237 Mil.
Revenue was 12232 + 12032 + 11902 + 11551 = $47,717 Mil.
Gross Profit was 1047 + 867 + 917 + 1007 = $3,838 Mil.
Total Current Assets was $7,069 Mil.
Total Assets was $43,589 Mil.
Property, Plant and Equipment(Net PPE) was $25,578 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,038 Mil.
Selling, General & Admin. Expense(SGA) was $416 Mil.
Total Current Liabilities was $7,491 Mil.
Long-Term Debt was $16,191 Mil.
Net Income was 415 + -541 + 355 + 320 = $549 Mil.
Non Operating Income was 144 + -136 + 122 + 72 = $202 Mil.
Cash Flow from Operations was 682 + 631 + 578 + 811 = $2,702 Mil.
Accounts Receivable was $3,713 Mil.
Revenue was 10854 + 10981 + 1802 + 1596 = $25,233 Mil.
Gross Profit was 933 + 863 + 609 + 601 = $3,006 Mil.
Total Current Assets was $6,359 Mil.
Total Assets was $44,368 Mil.
Property, Plant and Equipment(Net PPE) was $26,007 Mil.
Depreciation, Depletion and Amortization(DDA) was $817 Mil.
Selling, General & Admin. Expense(SGA) was $470 Mil.
Total Current Liabilities was $5,783 Mil.
Long-Term Debt was $16,135 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)
=(4237 / 47717) / (3713 / 25233)
=0.08879435 / 0.14714858
=0.6034

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)
=(867 / 25233) / (1047 / 47717)
=0.11912971 / 0.08043255
=1.4811

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 - (7069 + 25578) / 43589) / (1 - (6359 + 26007) / 44368)
=0.25102664 / 0.27051028
=0.928

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
=47717 / 25233
=1.8911

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))
=(817 / (817 + 26007)) / (1038 / (1038 + 25578))
=0.0304578 / 0.0389991
=0.781

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)
=(416 / 47717) / (470 / 25233)
=0.00871807 / 0.0186264
=0.468

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)
=((16191 + 7491) / 43589) / ((16135 + 5783) / 44368)
=0.54330221 / 0.49400469
=1.0998

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
=(549 - 202 - 2702) / 43589
=-0.054

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.

Energy Transfer Partners LP has a M-score of -2.04 signals that the company is likely to 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.

Energy Transfer Partners LP Annual Data

Aug04Aug05Aug06Aug07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 2.87491.2980.61911.12040.70591.69640.82351.00191.97690.3966
GMI 0.93071.2260.46170.65091.48990.56831.11160.97781.73231.9572
AQI 0.61510.65891.28630.94320.74421.41430.66111.23642.23260.9451
SGI 2.52082.62841.2740.86421.36830.58291.08631.15532.30952.9512
DEPI 0.99410.93281.10851.09521.04360.87971.02981.06121.28370.6489
SGAI 0.92430.78336.63741.53780.20131.53640.93381.040.88850.3778
LVGI 0.91061.04661.00120.89331.07880.93660.99990.96940.83971.0612
TATA -0.02720.0429-0.0052-0.0565-0.0389-0.0091-0.0471-0.04-0.0167-0.0471
M-score 0.32-0.56-3.74-3.01-2.33-2.40-2.85-2.430.50-0.99

Energy Transfer Partners LP Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.99850.80340.74220.94051.98371.77751.19480.83240.39660.6034
GMI 0.97591.02120.92790.85881.73582.31573.13343.96091.96931.4811
AQI 1.23642.47842.00841.84982.23261.08671.26371.14780.94510.928
SGI 1.15931.13281.06021.00842.30163.90755.47636.93962.95121.8911
DEPI 1.06121.0550.8870.79121.28371.07810.99531.03120.64890.781
SGAI 1.03671.37871.54911.64320.89130.44460.30740.24930.35990.468
LVGI 0.96940.93490.9820.92690.83970.88670.87960.89821.06121.0998
TATA -0.04-0.0312-0.0337-0.042-0.0167-0.0195-0.0266-0.0249-0.0471-0.054
M-score -2.43-2.12-2.55-2.570.501.612.964.34-0.98-2.04
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