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Lydall Inc (NYSE:LDL)
Beneish M-Score
-2.47 (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 -2.47 suggests that the company is not a manipulator.

LDL' s 10-Year Beneish M-Score Range
Min: -3.18   Max: -2.39
Current: -2.47

-3.18
-2.39

During the past 13 years, the highest Beneish M-Score of Lydall Inc was -2.39. 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 * 1.1981+0.528 * 0.998+0.404 * 1.0669+0.892 * 1.3464+0.115 * 1.0378
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0636+4.679 * -0.0566-0.327 * 1.7311
=-2.47

* 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 $84.4 Mil.
Revenue was 127.583 + 134.227 + 148.793 + 125.226 = $535.8 Mil.
Gross Profit was 25.562 + 28.564 + 34.653 + 26.199 = $115.0 Mil.
Total Current Assets was $213.3 Mil.
Total Assets was $361.8 Mil.
Property, Plant and Equipment(Net PPE) was $115.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $17.6 Mil.
Selling, General & Admin. Expense(SGA) was $80.9 Mil.
Total Current Liabilities was $73.1 Mil.
Long-Term Debt was $40.3 Mil.
Net Income was 5.733 + 4.158 + 8.24 + 3.716 = $21.8 Mil.
Non Operating Income was 0.547 + 0.508 + -0.299 + -0.055 = $0.7 Mil.
Cash Flow from Operations was 11.129 + 17.125 + 16.234 + -2.86 = $41.6 Mil.
Accounts Receivable was $52.3 Mil.
Revenue was 99.894 + 97.995 + 101.051 + 99.029 = $398.0 Mil.
Gross Profit was 20.329 + 20.494 + 23.037 + 21.365 = $85.2 Mil.
Total Current Assets was $172.3 Mil.
Total Assets was $274.7 Mil.
Property, Plant and Equipment(Net PPE) was $78.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $12.6 Mil.
Selling, General & Admin. Expense(SGA) was $56.5 Mil.
Total Current Liabilities was $48.7 Mil.
Long-Term Debt was $1.1 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)
=(84.366 / 535.829) / (52.301 / 397.969)
=0.15744948 / 0.13141978
=1.1981

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)
=(28.564 / 397.969) / (25.562 / 535.829)
=0.21414985 / 0.21457965
=0.998

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 - (213.306 + 115.357) / 361.77) / (1 - (172.261 + 78.863) / 274.685)
=0.09151395 / 0.08577461
=1.0669

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
=535.829 / 397.969
=1.3464

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))
=(12.593 / (12.593 + 78.863)) / (17.646 / (17.646 + 115.357))
=0.13769463 / 0.1326737
=1.0378

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)
=(80.93 / 535.829) / (56.512 / 397.969)
=0.15103699 / 0.14200101
=1.0636

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)
=((40.315 + 73.077) / 361.77) / ((1.051 + 48.684) / 274.685)
=0.31343671 / 0.18106194
=1.7311

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
=(21.847 - 0.701 - 41.628) / 361.77
=-0.0566

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 -2.47 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.00380.91790.98560.72671.42390.8720.88451.01721.04871.1981
GMI 0.93950.93640.98681.09741.53010.78510.97290.85710.95880.998
AQI 0.97390.95960.88751.01060.85280.86590.90760.87610.90561.0669
SGI 1.04390.99881.04830.95260.81431.35771.13490.98781.05031.3464
DEPI 1.02051.00841.03930.91870.94291.02190.90571.02571.09731.0378
SGAI 0.94210.97290.99951.00721.13470.80890.83631.09460.94011.0636
LVGI 0.93280.76510.9720.84121.10941.22130.82760.95220.95031.7311
TATA -0.057-0.1223-0.0509-0.1072-0.1265-0.0454-0.0041-0.0697-0.0403-0.0566
M-score -2.71-3.10-2.73-3.18-2.69-2.70-2.46-2.92-2.60-2.47

Lydall Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.10311.03430.96010.98081.06681.04871.59921.45461.10111.1981
GMI 0.82920.85770.86580.9150.96880.95880.98760.97690.97960.998
AQI 0.89580.87610.87030.8880.88660.90561.00670.9971.02451.0669
SGI 0.95290.97151.00671.01951.02841.05031.11271.22661.30781.3464
DEPI 1.08351.02571.0111.00191.03321.09731.50251.31911.1431.0378
SGAI 1.05091.09631.07781.05821.00470.94010.93590.9721.05751.0636
LVGI 0.91850.95220.91490.91440.90970.95031.84071.84341.84611.7311
TATA -0.0592-0.0697-0.0508-0.0441-0.0314-0.0403-0.0332-0.0428-0.0792-0.0566
M-score -2.81-2.92-2.86-2.76-2.57-2.60-2.19-2.31-2.75-2.47
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