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Matthews International Corporation (NAS:MATW)
Beneish M-Score
-2.28 (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.

Matthews International Corporation has a M-score of -2.28 suggests that the company is not a manipulator.

MATW' s 10-Year Beneish M-Score Range
Min: -3.3   Max: -2.03
Current: -2.28

-3.3
-2.03

During the past 13 years, the highest Beneish M-Score of Matthews International Corporation was -2.03. The lowest was -3.30. And the median was -2.53.


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 Matthews International Corporation 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 * 1.0475+0.528 * 1.0072+0.404 * 1.1992+0.892 * 1.3496+0.115 * 0.8319
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0714+4.679 * -0.0361-0.327 * 1.1138
=-2.28

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $262 Mil.
Revenue was 349.394 + 343.584 + 349.832 + 279.983 = $1,323 Mil.
Gross Profit was 127.695 + 124.67 + 116.708 + 104.23 = $473 Mil.
Total Current Assets was $541 Mil.
Total Assets was $1,921 Mil.
Property, Plant and Equipment(Net PPE) was $198 Mil.
Depreciation, Depletion and Amortization(DDA) was $56 Mil.
Selling, General & Admin. Expense(SGA) was $381 Mil.
Total Current Liabilities was $228 Mil.
Long-Term Debt was $684 Mil.
Net Income was 9.576 + 14.951 + 5.164 + 19.263 = $49 Mil.
Non Operating Income was -0.536 + -0.164 + -3.544 + -0.441 = $-5 Mil.
Cash Flow from Operations was 44.824 + 9.292 + 28.852 + 39.939 = $123 Mil.
Accounts Receivable was $185 Mil.
Revenue was 246.837 + 229.945 + 252.706 + 250.652 = $980 Mil.
Gross Profit was 90.18 + 81.376 + 90.287 + 91.391 = $353 Mil.
Total Current Assets was $421 Mil.
Total Assets was $1,228 Mil.
Property, Plant and Equipment(Net PPE) was $176 Mil.
Depreciation, Depletion and Amortization(DDA) was $39 Mil.
Selling, General & Admin. Expense(SGA) was $264 Mil.
Total Current Liabilities was $170 Mil.
Long-Term Debt was $354 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)
=(261.922 / 1322.793) / (185.274 / 980.14)
=0.19800679 / 0.1890281
=1.0475

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)
=(124.67 / 980.14) / (127.695 / 1322.793)
=0.36039137 / 0.35780579
=1.0072

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 - (540.674 + 198.188) / 1921.113) / (1 - (421.454 + 176.406) / 1228.061)
=0.61539899 / 0.51316751
=1.1992

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
=1322.793 / 980.14
=1.3496

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))
=(39.472 / (39.472 + 176.406)) / (55.831 / (55.831 + 198.188))
=0.18284401 / 0.21979065
=0.8319

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)
=(381.44 / 1322.793) / (263.789 / 980.14)
=0.28835955 / 0.269134
=1.0714

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)
=((684.007 + 228.388) / 1921.113) / ((354.167 + 169.508) / 1228.061)
=0.47493042 / 0.42642426
=1.1138

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
=(48.954 - -4.685 - 122.907) / 1921.113
=-0.0361

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.

Matthews International Corporation has a M-score of -2.28 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.

Matthews International Corporation Annual Data

Sep05Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14
DSRI 1.04860.94320.94851.10021.00241.0330.99731.05830.92931.4173
GMI 1.09220.91791.01490.94871.04510.95931.00581.04661.03321.0201
AQI 1.07551.03911.00220.94441.0470.99761.01640.96890.98671.1894
SGI 1.25751.11891.04671.09240.95391.05241.09371.00171.09451.123
DEPI 0.96720.93371.04451.28370.8121.03441.01981.02310.96251.0191
SGAI 1.00461.13311.01931.03141.0691.01421.03081.04050.98041.0574
LVGI 1.27080.90460.95841.20870.9350.96461.11791.01111.04361.0743
TATA -0.0244-0.0019-0.0164-0.0299-0.037-0.0364-0.0214-0.026-0.0417-0.0218
M-score -2.33-2.46-2.54-2.54-2.66-2.58-2.53-2.54-2.66-2.03

Matthews International Corporation Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 1.12561.08161.00670.92930.85990.95881.03711.41731.26041.0475
GMI 1.03361.02141.02751.03321.03021.02981.00941.02011.01261.0072
AQI 0.99260.99041.01060.98670.96750.96070.92941.18941.19281.1992
SGI 11.02791.05791.09451.08911.04321.04851.1231.23291.3496
DEPI 1.1931.07951.02850.96250.81750.85920.90561.01910.93350.8319
SGAI 1.05531.07071.02740.98040.97960.9811.01641.05961.05291.0714
LVGI 1.0961.11161.05431.04360.94080.93170.96281.07431.08831.1138
TATA -0.0263-0.0298-0.0402-0.041-0.0461-0.0398-0.0354-0.0221-0.0175-0.0361
M-score -2.49-2.55-2.61-2.66-2.74-2.66-2.59-2.03-2.08-2.28
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