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Lydall Inc (NYSE:LDL)
Beneish M-Score
-2.49 (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.

Lydall Inc has a M-score of -2.49 suggests that the company is not a manipulator.

LDL' s Beneish M-Score Range Over the Past 10 Years
Min: -3.18   Max: -2.02
Current: -2.49

-3.18
-2.02

During the past 13 years, the highest Beneish M-Score of Lydall Inc was -2.02. The lowest was -3.18. And the median was -2.67.


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 * 0.9463+0.404 * 0.845+0.892 * 1.0247+0.115 * 0.9221
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8558+4.679 * 0.0022-0.327 * 0.8416
=-2.49

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $91.8 Mil.
Revenue was 131.24 + 134.561 + 127.306 + 127.583 = $520.7 Mil.
Gross Profit was 31.691 + 33.889 + 27.7 + 25.562 = $118.8 Mil.
Total Current Assets was $244.3 Mil.
Total Assets was $383.3 Mil.
Property, Plant and Equipment(Net PPE) was $110.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $17.4 Mil.
Selling, General & Admin. Expense(SGA) was $68.8 Mil.
Total Current Liabilities was $72.9 Mil.
Long-Term Debt was $40.0 Mil.
Net Income was 11.186 + 10.817 + 18.937 + 5.733 = $46.7 Mil.
Non Operating Income was 0.15 + -0.553 + 19.669 + 0.547 = $19.8 Mil.
Cash Flow from Operations was 10.402 + 5.592 + -1.097 + 11.129 = $26.0 Mil.
Accounts Receivable was $91.7 Mil.
Revenue was 134.227 + 148.793 + 125.226 + 99.894 = $508.1 Mil.
Gross Profit was 28.564 + 34.653 + 26.199 + 20.329 = $109.7 Mil.
Total Current Assets was $229.3 Mil.
Total Assets was $375.5 Mil.
Property, Plant and Equipment(Net PPE) was $113.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $16.3 Mil.
Selling, General & Admin. Expense(SGA) was $78.5 Mil.
Total Current Liabilities was $71.0 Mil.
Long-Term Debt was $60.5 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)
=(91.754 / 520.69) / (91.741 / 508.14)
=0.17621617 / 0.18054276
=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)
=(33.889 / 508.14) / (31.691 / 520.69)
=0.21597394 / 0.22823945
=0.9463

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 - (244.328 + 110.843) / 383.261) / (1 - (229.266 + 113.71) / 375.548)
=0.07329209 / 0.08673192
=0.845

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
=520.69 / 508.14
=1.0247

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))
=(16.294 / (16.294 + 113.71)) / (17.437 / (17.437 + 110.843))
=0.12533461 / 0.13592922
=0.9221

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)
=(68.824 / 520.69) / (78.478 / 508.14)
=0.13217846 / 0.15444169
=0.8558

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)
=((40.003 + 72.926) / 383.261) / ((60.488 + 70.989) / 375.548)
=0.29465299 / 0.35009373
=0.8416

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
=(46.673 - 19.813 - 26.026) / 383.261
=0.0022

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 -2.49 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 1.00380.91790.98560.72671.42390.93240.82721.01721.04871.1981
GMI 0.93950.93640.98681.09741.55140.77810.96820.85710.95880.998
AQI 0.97390.95960.88751.01060.85510.86350.90760.87610.90561.0669
SGI 1.04390.99881.04830.95260.81431.26981.21350.98781.05031.3464
DEPI 1.02051.00841.03930.91870.93041.03570.90571.02571.08911.0457
SGAI 0.94210.97290.99951.00721.13470.82020.82481.09460.94011.0636
LVGI 0.93280.76510.9720.84121.11431.21590.82760.95220.95031.7311
TATA -0.057-0.1223-0.0509-0.1072-0.1277-0.0353-0.0041-0.0697-0.0403-0.0566
M-score -2.71-3.10-2.73-3.18-2.69-2.67-2.45-2.92-2.60-2.47

Lydall Inc Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 0.98081.06681.04871.59921.45461.10111.19810.71370.83350.976
GMI 0.9150.96880.95880.98760.97690.97960.9980.98050.97510.9463
AQI 0.8880.88660.90561.00670.9971.02451.06690.8420.83930.845
SGI 1.01951.02841.05031.11271.22661.30781.34641.26821.10971.0247
DEPI 1.00191.03321.08911.49121.31041.13631.04570.71930.82930.9221
SGAI 1.05821.00470.94010.93590.9721.05751.06361.0470.97920.8558
LVGI 0.91440.90970.95031.84071.84341.84611.73110.88860.82980.8416
TATA -0.0441-0.0314-0.0403-0.0332-0.0428-0.0792-0.0566-0.073-0.03540.0022
M-score -2.76-2.57-2.60-2.19-2.31-2.75-2.47-2.92-2.74-2.49
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