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FMC Corp (NYSE:FMC)
Beneish M-Score
-1.49 (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.

FMC Corp has a M-score of -1.49 signals that the company is a manipulator.

FMC' s Beneish M-Score Range Over the Past 10 Years
Min: -3.31   Max: -1.49
Current: -1.49

-3.31
-1.49

During the past 13 years, the highest Beneish M-Score of FMC Corp was -1.49. The lowest was -3.31. And the median was -2.52.


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 FMC Corp 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 * 1.065+0.528 * 1.1416+0.404 * 1.8537+0.892 * 1.0806+0.115 * 0.8474
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.6781+4.679 * 0.0796-0.327 * 0.9023
=-1.49

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $1,769 Mil.
Revenue was 798.8 + 899.3 + 830.7 + 887.1 = $3,416 Mil.
Gross Profit was 281.4 + 298.6 + 220.3 + 305.8 = $1,106 Mil.
Total Current Assets was $2,955 Mil.
Total Assets was $6,390 Mil.
Property, Plant and Equipment(Net PPE) was $1,028 Mil.
Depreciation, Depletion and Amortization(DDA) was $127 Mil.
Selling, General & Admin. Expense(SGA) was $567 Mil.
Total Current Liabilities was $1,451 Mil.
Long-Term Debt was $1,986 Mil.
Net Income was 48.3 + -204.1 + -2.4 + 742.3 = $584 Mil.
Non Operating Income was -41.6 + 117.6 + -40.4 + 0.1 = $36 Mil.
Cash Flow from Operations was 100.3 + -47.2 + -137.9 + 124.6 = $40 Mil.
Accounts Receivable was $1,537 Mil.
Revenue was 659.4 + 887.8 + 819.1 + 794.9 = $3,161 Mil.
Gross Profit was 250.7 + 318.3 + 283.5 + 316.1 = $1,169 Mil.
Total Current Assets was $3,330 Mil.
Total Assets was $5,312 Mil.
Property, Plant and Equipment(Net PPE) was $903 Mil.
Depreciation, Depletion and Amortization(DDA) was $92 Mil.
Selling, General & Admin. Expense(SGA) was $773 Mil.
Total Current Liabilities was $2,016 Mil.
Long-Term Debt was $1,151 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)
=(1769.2 / 3415.9) / (1537.4 / 3161.2)
=0.51793085 / 0.4863343
=1.065

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)
=(298.6 / 3161.2) / (281.4 / 3415.9)
=0.36966975 / 0.32380925
=1.1416

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 - (2955.2 + 1027.8) / 6390.4) / (1 - (3329.6 + 902.6) / 5311.7)
=0.37672133 / 0.2032306
=1.8537

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
=3415.9 / 3161.2
=1.0806

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))
=(92.4 / (92.4 + 902.6)) / (126.5 / (126.5 + 1027.8))
=0.09286432 / 0.10959023
=0.8474

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)
=(566.5 / 3415.9) / (773.1 / 3161.2)
=0.16584209 / 0.24455903
=0.6781

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)
=((1986.2 + 1451.3) / 6390.4) / ((1150.9 + 2015.6) / 5311.7)
=0.53791625 / 0.59613683
=0.9023

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
=(584.1 - 35.7 - 39.8) / 6390.4
=0.0796

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.

FMC Corp has a M-score of -1.49 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.

FMC Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.9970.99380.96921.20151.03191.00741.0391.33731.03611.4237
GMI 0.99040.99280.96841.00820.92620.97560.96591.03441.01581.0375
AQI 0.97590.93580.93911.051.0431.0421.1920.70441.37891.3465
SGI 1.09151.12181.18320.90721.10261.08391.10971.03371.0420.8115
DEPI 1.04190.91041.07151.00240.91761.11680.90271.36210.7481.2097
SGAI 0.96530.98650.90281.05481.15710.99281.07350.94661.15581.4638
LVGI 0.9550.94611.05410.91591.06791.03431.03891.26390.95430.9635
TATA -0.0462-0.04750.0036-0.024-0.0556-0.00480.013-0.0065-0.01230.1339
M-score -2.61-2.62-2.36-2.45-2.70-2.41-2.26-2.31-2.35-1.52

FMC Corp Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.58231.53051.67151.76931.03720.92311.1070.90741.1491.065
GMI 0.94910.96310.94670.88881.03231.03621.0951.1981.13221.1416
AQI 0.70440.90250.90720.90161.37890.96741.43341.55941.34651.8537
SGI 0.87370.83780.82170.75351.04091.06191.12351.1841.00551.0806
DEPI 1.64161.47041.47961.92140.72090.66350.69870.51910.89390.8474
SGAI 1.11671.16391.17031.3021.14221.48941.49771.36961.24430.6781
LVGI 1.26391.1331.18880.95720.95431.05351.02630.98620.96350.9023
TATA -0.0108-0.0138-0.00690.0073-0.02180.00010.10180.13980.12610.0796
M-score -2.29-2.28-2.16-1.99-2.38-2.63-1.70-1.53-1.58-1.49
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