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Corning Inc (NYSE:GLW)
Beneish M-Score
-2.81 (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.

Corning Inc has a M-score of -2.81 suggests that the company is not a manipulator.

GLW' s 10-Year Beneish M-Score Range
Min: -5.79   Max: -1.54
Current: -2.81

-5.79
-1.54

During the past 13 years, the highest Beneish M-Score of Corning Inc was -1.54. The lowest was -5.79. And the median was -2.69.


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 Corning 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 * 0.9861+0.528 * 0.9744+0.404 * 1.1148+0.892 * 0.9759+0.115 * 0.9249
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9575+4.679 * -0.0716-0.327 * 0.9697
=-2.81

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $1,253 Mil.
Revenue was 1956 + 2067 + 1982 + 1814 = $7,819 Mil.
Gross Profit was 770 + 901 + 883 + 770 = $3,324 Mil.
Total Current Assets was $8,891 Mil.
Total Assets was $28,478 Mil.
Property, Plant and Equipment(Net PPE) was $9,801 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,002 Mil.
Selling, General & Admin. Expense(SGA) was $1,126 Mil.
Total Current Liabilities was $1,746 Mil.
Long-Term Debt was $3,272 Mil.
Net Income was 421 + 408 + 638 + 494 = $1,961 Mil.
Non Operating Income was 408 + 137 + 431 + 238 = $1,214 Mil.
Cash Flow from Operations was 1284 + 485 + 395 + 623 = $2,787 Mil.
Accounts Receivable was $1,302 Mil.
Revenue was 2146 + 2038 + 1908 + 1920 = $8,012 Mil.
Gross Profit was 798 + 889 + 808 + 824 = $3,319 Mil.
Total Current Assets was $9,695 Mil.
Total Assets was $29,375 Mil.
Property, Plant and Equipment(Net PPE) was $10,625 Mil.
Depreciation, Depletion and Amortization(DDA) was $997 Mil.
Selling, General & Admin. Expense(SGA) was $1,205 Mil.
Total Current Liabilities was $1,956 Mil.
Long-Term Debt was $3,382 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)
=(1253 / 7819) / (1302 / 8012)
=0.16025067 / 0.16250624
=0.9861

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)
=(901 / 8012) / (770 / 7819)
=0.41425362 / 0.4251183
=0.9744

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 - (8891 + 9801) / 28478) / (1 - (9695 + 10625) / 29375)
=0.34363368 / 0.30825532
=1.1148

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
=7819 / 8012
=0.9759

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))
=(997 / (997 + 10625)) / (1002 / (1002 + 9801))
=0.08578558 / 0.09275201
=0.9249

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)
=(1126 / 7819) / (1205 / 8012)
=0.14400819 / 0.1503994
=0.9575

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)
=((3272 + 1746) / 28478) / ((3382 + 1956) / 29375)
=0.17620619 / 0.18171915
=0.9697

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
=(1961 - 1214 - 2787) / 28478
=-0.0716

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.

Corning Inc has a M-score of -2.81 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.

Corning Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.73060.9051.04961.01310.58931.62151.05120.93471.1850.9861
GMI 0.74830.84740.9820.94061.01911.18650.84381.01721.0910.9744
AQI 0.62030.93120.98681.09921.29271.09260.8510.98181.00991.1148
SGI 1.24721.18811.12991.13261.0150.9071.22931.18971.01550.9759
DEPI 1.06671.18690.9661.10981.17820.8671.0341.05920.95940.9249
SGAI 0.8740.97441.00320.93960.97331.10250.91640.85551.14870.9575
LVGI 1.19410.79160.82810.8610.70240.87651.00940.97421.13440.9697
TATA -0.1877-0.1619-0.0716-0.00490.1637-0.0787-0.0936-0.0708-0.0838-0.0716
M-score -3.71-3.17-2.62-2.30-1.83-2.22-2.79-2.66-2.71-2.81

Corning Inc Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.14690.93470.88860.86541.05171.1851.11911.09351.07970.9861
GMI 1.01431.01721.02261.01161.04641.0911.07951.05351.03120.9744
AQI 0.86190.98180.92770.95480.98181.00991.09691.10181.11111.1148
SGI 1.21391.18971.12641.06790.99811.01551.00241.02441.0330.9759
DEPI 1.06151.05921.0141.01991.02540.95940.94320.89370.87680.9249
SGAI 0.86020.85960.90580.92341.09071.14321.12511.08050.98170.9575
LVGI 0.920.97421.11151.14421.1741.13440.94240.8740.85580.9697
TATA -0.0915-0.0708-0.0793-0.082-0.0766-0.0838-0.0803-0.0747-0.0692-0.0716
M-score -2.57-2.66-2.88-2.97-2.84-2.71-2.67-2.64-2.60-2.81
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