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Lydall Inc (NYSE:LDL)
Beneish M-Score
-2.31 (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 -2.31 suggests that the company is not a manipulator.

LDL' s 10-Year Beneish M-Score Range
Min: -3.14   Max: -2.02
Current: -2.31

-3.14
-2.02

During the past 13 years, the highest Beneish M-Score of Lydall Inc was -2.02. The lowest was -3.14. And the median was -2.65.


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 * 1.4546+0.528 * 0.9769+0.404 * 0.997+0.892 * 1.2266+0.115 * 1.3191
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.972+4.679 * -0.0428-0.327 * 1.8434
=-2.31

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $101.8 Mil.
Revenue was 148.793 + 125.226 + 99.894 + 97.995 = $471.9 Mil.
Gross Profit was 34.653 + 26.199 + 20.329 + 20.494 = $101.7 Mil.
Total Current Assets was $229.5 Mil.
Total Assets was $377.6 Mil.
Property, Plant and Equipment(Net PPE) was $115.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $14.6 Mil.
Selling, General & Admin. Expense(SGA) was $68.8 Mil.
Total Current Liabilities was $73.5 Mil.
Long-Term Debt was $60.7 Mil.
Net Income was 8.24 + 3.716 + 4.133 + 4.575 = $20.7 Mil.
Non Operating Income was -0.299 + -0.055 + -0.023 + 0.016 = $-0.4 Mil.
Cash Flow from Operations was 16.234 + -2.86 + 19.372 + 4.428 = $37.2 Mil.
Accounts Receivable was $57.0 Mil.
Revenue was 101.051 + 99.029 + 90.468 + 94.167 = $384.7 Mil.
Gross Profit was 23.037 + 21.365 + 17.304 + 19.269 = $81.0 Mil.
Total Current Assets was $163.4 Mil.
Total Assets was $261.4 Mil.
Property, Plant and Equipment(Net PPE) was $75.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $13.1 Mil.
Selling, General & Admin. Expense(SGA) was $57.7 Mil.
Total Current Liabilities was $49.1 Mil.
Long-Term Debt was $1.3 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)
=(101.771 / 471.908) / (57.039 / 384.715)
=0.21565856 / 0.148263
=1.4546

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)
=(26.199 / 384.715) / (34.653 / 471.908)
=0.21048049 / 0.21545513
=0.9769

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 - (229.483 + 114.995) / 377.565) / (1 - (163.36 + 75.058) / 261.393)
=0.08763259 / 0.08789447
=0.997

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
=471.908 / 384.715
=1.2266

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))
=(13.124 / (13.124 + 75.058)) / (14.624 / (14.624 + 114.995))
=0.14882856 / 0.11282297
=1.3191

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)
=(68.801 / 471.908) / (57.704 / 384.715)
=0.14579325 / 0.14999155
=0.972

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)
=((60.703 + 73.52) / 377.565) / ((1.314 + 49.095) / 261.393)
=0.3554964 / 0.19284755
=1.8434

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
=(20.664 - -0.361 - 37.174) / 377.565
=-0.0428

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 -2.31 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.12070.99460.91160.98560.7691.50310.81160.86151.02491.0599
GMI 1.20690.93950.93640.98681.09741.53010.78510.97290.85710.9588
AQI 1.01640.97390.95960.88751.01060.85280.86590.90760.87610.9056
SGI 1.07851.04390.99881.04830.95260.81431.35771.13490.98781.0503
DEPI 0.98151.02051.00841.03930.91870.94291.02190.90571.02571.0973
SGAI 1.04960.94210.97290.99951.00721.13470.80890.83631.09460.9401
LVGI 1.23130.93280.76510.9720.84121.10941.22130.82760.95220.9503
TATA -0.0724-0.057-0.1223-0.0509-0.1072-0.1265-0.0454-0.0041-0.0697-0.0403
M-score -2.61-2.72-3.10-2.73-3.14-2.62-2.75-2.48-2.92-2.59

Lydall Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.88041.00651.0931.04210.96010.98081.06681.05991.59921.4546
GMI 0.94430.87750.82920.85770.86580.9150.96880.95880.98760.9769
AQI 0.91340.91360.89580.87610.87030.8880.88660.90561.00670.997
SGI 1.02190.97640.95290.97151.00671.01951.02841.05031.11271.2266
DEPI 0.91881.01761.08351.02571.0111.00191.03321.09731.50251.3191
SGAI 0.93520.99711.05091.09631.07781.05821.00470.94010.93590.972
LVGI 0.8490.9270.91850.95220.91490.91440.90970.95031.84071.8434
TATA -0.0082-0.0292-0.0592-0.0697-0.0508-0.0441-0.0314-0.0403-0.0332-0.0428
M-score -2.62-2.70-2.82-2.92-2.86-2.76-2.57-2.59-2.19-2.31
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