Teco Electric & Machinery Co (LSE:TECD) Beneish M-Score : -2.59 (As of May. 17, 2024)

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What is Teco Electric & Machinery Co Beneish M-Score?

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.59 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Teco Electric & Machinery Co's Beneish M-Score or its related term are showing as below:

LSE:TECD' s Beneish M-Score Range Over the Past 10 Years
Min: -2.74 Med: -2.54 Max: -2.07
Current: -2.59

During the past 13 years, the highest Beneish M-Score of Teco Electric & Machinery Co was -2.07. The lowest was -2.74. And the median was -2.54.

Teco Electric & Machinery Co Beneish M-Score Historical Data

The historical data trend for Teco Electric & Machinery Co's Beneish M-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Teco Electric & Machinery Co Beneish M-Score Chart

Teco Electric & Machinery Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.63

-2.50

-2.07

-2.64

-2.47

Teco Electric & Machinery Co Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
Beneish M-Score	Get a 7-Day Free Trial															-2.42	-2.42	-2.38	-2.47	-2.59

Competitive Comparison of Teco Electric & Machinery Co's Beneish M-Score

For the Specialty Industrial Machinery subindustry, Teco Electric & Machinery Co's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Teco Electric & Machinery Co's Beneish M-Score Distribution in the Industrial Products Industry

For the Industrial Products industry and Industrials sector, Teco Electric & Machinery Co's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Teco Electric & Machinery Co's Beneish M-Score falls into.

Teco Electric & Machinery Co Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Teco Electric & Machinery Co for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 1.0511

0.528 * 0.9088

0.404 * 0.8304

0.892 * 0.9523

0.115 * 0.9344

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0439

4.679 * -0.007511

0.327 * 1.1108

-2.68

This Year (Mar24) TTM:

Last Year (Mar23) TTM:

Total Receivables was $352 Mil.
Revenue was 433.214 + 459.636 + 470.145 + 488.451 = $1,851 Mil.
Gross Profit was 112.233 + 119.159 + 115.72 + 125.87 = $473 Mil.
Total Current Assets was $1,720 Mil.
Total Assets was $3,990 Mil.
Property, Plant and Equipment(Net PPE) was $865 Mil.
Depreciation, Depletion and Amortization(DDA) was $64 Mil.
Selling, General, & Admin. Expense(SGA) was $227 Mil.
Total Current Liabilities was $862 Mil.
Long-Term Debt & Capital Lease Obligation was $422 Mil.
Net Income was 36.575 + 34.946 + 30.619 + 68.803 = $171 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 21.93 + 132.011 + 29.015 + 17.96 = $201 Mil.

Total Receivables was $352 Mil.
Revenue was 487.967 + 491.256 + 473.683 + 491.289 = $1,944 Mil.
Gross Profit was 118.84 + 112.902 + 106.786 + 112.843 = $451 Mil.
Total Current Assets was $1,691 Mil.
Total Assets was $4,453 Mil.
Property, Plant and Equipment(Net PPE) was $872 Mil.
Depreciation, Depletion and Amortization(DDA) was $60 Mil.
Selling, General, & Admin. Expense(SGA) was $228 Mil.
Total Current Liabilities was $841 Mil.
Long-Term Debt & Capital Lease Obligation was $449 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total 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)
	=	(352.27 / 1851.446)	/	(351.947 / 1944.195)
	=	0.190267	/	0.181025
	=	1.0511

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)
	=	(451.371 / 1944.195)	/	(472.982 / 1851.446)
	=	0.232163	/	0.255466
	=	0.9088

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 Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (1719.709 + 864.601) / 3990.465)	/	(1 - (1691.275 + 872.237) / 4453.375)
	=	0.352379	/	0.424366
	=	0.8304

4. SGI = Sales Growth Index

Ratio of Revenue 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
	=	1851.446	/	1944.195
	=	0.9523

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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))
	=	(59.82 / (59.82 + 872.237))	/	(63.77 / (63.77 + 864.601))
	=	0.064181	/	0.06869
	=	0.9344

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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)
	=	(226.728 / 1851.446)	/	(228.069 / 1944.195)
	=	0.12246	/	0.117308
	=	1.0439

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 in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((421.921 + 862.433) / 3990.465)	/	((449.356 + 841.017) / 4453.375)
	=	0.321856	/	0.289752
	=	1.1108

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
	=	(170.943 - 0	-	200.916)	/	3990.465
	=	-0.007511

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Teco Electric & Machinery Co has a M-score of -2.68 suggests that the company is unlikely to be a manipulator.

Teco Electric & Machinery Co Beneish M-Score Related Terms

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Teco Electric & Machinery Co (LSE:TECD) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Industrial Products » Teco Electric & Machinery Co Ltd (LSE:TECD) » Definitions » Beneish M-Score

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1504:Taiwan

Address

No. 19-9, San Chong Road, Nan-Kang, 5th Floor, Taipei, TWN, 11501

Website

https://www.teco.com.tw

Teco Electric & Machinery Co Ltd is a Taiwan-based company that manufactures and sells various types of mechanical equipment, air-conditioning units and electronic equipment products. The company's Heavy industrial products, the largest product line by revenue contribution, are used in fluid machinery, elevators, cranes, petrochemical machinery, rolling mills, pumps, and various other machinery. The company's home appliance offerings comprise air conditioners, refrigerators, washing machines, televisions, air purifiers, and others. The company also provides automation products such as converters, servo controllers, and circuit breakers. The company generates the majority of its sales from Taiwan.