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Lydall Inc (NYSE:LDL)
Beneish M-Score
-2.86 (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.

Lydall Inc has a M-score of -2.86 suggests that the company is not a manipulator.

LDL' s Beneish M-Score Range Over the Past 10 Years
Min: -3.18   Max: -2.14
Current: -2.86

-3.18
-2.14

During the past 13 years, the highest Beneish M-Score of Lydall Inc was -2.14. The lowest was -3.18. And the median was -2.66.


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 Lydall 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 * 0.976+0.528 * 0.9052+0.404 * 0.8707+0.892 * 1.0113+0.115 * 1.0743
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9881+4.679 * -0.0787-0.327 * 0.731
=-2.86

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $92.9 Mil.
Revenue was 137.235 + 129.7 + 131.398 + 131.24 = $529.6 Mil.
Gross Profit was 35.99 + 32.377 + 29.217 + 31.691 = $129.3 Mil.
Total Current Assets was $231.3 Mil.
Total Assets was $373.4 Mil.
Property, Plant and Equipment(Net PPE) was $118.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $17.3 Mil.
Selling, General & Admin. Expense(SGA) was $74.7 Mil.
Total Current Liabilities was $70.4 Mil.
Long-Term Debt was $10.1 Mil.
Net Income was 10.813 + 9.169 + 5.319 + 11.186 = $36.5 Mil.
Non Operating Income was 0.499 + 0.167 + 0.035 + 0.15 = $0.9 Mil.
Cash Flow from Operations was 20.624 + 12.783 + 21.213 + 10.402 = $65.0 Mil.
Accounts Receivable was $94.1 Mil.
Revenue was 134.561 + 127.306 + 127.583 + 134.227 = $523.7 Mil.
Gross Profit was 33.889 + 27.7 + 25.562 + 28.564 = $115.7 Mil.
Total Current Assets was $235.9 Mil.
Total Assets was $375.1 Mil.
Property, Plant and Equipment(Net PPE) was $111.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $17.7 Mil.
Selling, General & Admin. Expense(SGA) was $74.8 Mil.
Total Current Liabilities was $70.7 Mil.
Long-Term Debt was $40.0 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)
=(92.905 / 529.573) / (94.133 / 523.677)
=0.17543379 / 0.17975393
=0.976

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)
=(115.715 / 523.677) / (129.275 / 529.573)
=0.22096636 / 0.24411177
=0.9052

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 - (231.297 + 118.214) / 373.423) / (1 - (235.915 + 111.616) / 375.12)
=0.06403462 / 0.07354713
=0.8707

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
=529.573 / 523.677
=1.0113

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))
=(17.711 / (17.711 + 111.616)) / (17.272 / (17.272 + 118.214))
=0.13694743 / 0.12748181
=1.0743

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)
=(74.704 / 529.573) / (74.759 / 523.677)
=0.14106459 / 0.14275785
=0.9881

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)
=((10.135 + 70.395) / 373.423) / ((40.006 + 70.656) / 375.12)
=0.21565356 / 0.29500427
=0.731

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
=(36.487 - 0.851 - 65.022) / 373.423
=-0.0787

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.

Lydall Inc has a M-score of -2.86 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.

Lydall Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.91790.98560.72671.42390.93240.82721.01721.04871.19810.9947
GMI 0.93640.98681.09741.55140.77810.96820.85710.95880.9980.9188
AQI 0.95960.88751.01060.85510.86350.90760.87610.90561.06690.748
SGI 0.99881.04830.95260.81431.26981.21350.98781.05031.34640.9789
DEPI 1.00841.03930.91870.93041.03570.90571.01871.09661.04571.0115
SGAI 0.97290.99951.00721.13470.82020.82481.09460.94011.06360.8839
LVGI 0.76510.9720.84121.11431.21590.82760.95220.95031.73110.7227
TATA -0.1223-0.0509-0.1072-0.1287-0.0353-0.0041-0.0697-0.0403-0.0566-0.0255
M-score -3.10-2.73-3.18-2.69-2.67-2.45-2.93-2.60-2.47-2.66

Lydall Inc Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 1.59921.45461.10111.19810.71370.83350.9760.99471.04360.976
GMI 0.98760.97690.97960.9980.98050.97510.94630.91880.89720.9052
AQI 1.00670.9971.02451.06690.8420.83930.8450.7480.88020.8707
SGI 1.11271.22661.30781.34641.26821.10971.02470.97890.97951.0113
DEPI 1.50171.31971.14461.04570.71930.82930.92211.01151.10331.0743
SGAI 0.93590.9721.05751.06361.0470.97920.85580.88390.90750.9881
LVGI 1.84071.84341.84611.73110.88860.82980.84160.72270.66340.731
TATA -0.0332-0.0428-0.0792-0.0566-0.073-0.03540.0022-0.0255-0.0366-0.0787
M-score -2.19-2.31-2.75-2.47-2.92-2.74-2.49-2.66-2.59-2.86
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