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Matthews International Corporation (NAS:MATW)
Beneish M-Score
-2.75 (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 -2.75 suggests that the company is not a manipulator.

MATW' s Beneish M-Score Range Over the Past 10 Years
Min: -3.3   Max: -2.03
Current: -2.75

-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 * 0.8509+0.528 * 0.9658+0.404 * 0.9999+0.892 * 1.1774+0.115 * 0.8853
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0879+4.679 * -0.0444-0.327 * 1.1253
=-2.75

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

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $268 Mil.
Revenue was 354.232 + 368.338 + 364.752 + 349.394 = $1,437 Mil.
Gross Profit was 126.567 + 141.574 + 135.436 + 127.695 = $531 Mil.
Total Current Assets was $585 Mil.
Total Assets was $2,126 Mil.
Property, Plant and Equipment(Net PPE) was $227 Mil.
Depreciation, Depletion and Amortization(DDA) was $63 Mil.
Selling, General & Admin. Expense(SGA) was $440 Mil.
Total Current Liabilities was $223 Mil.
Long-Term Debt was $901 Mil.
Net Income was 4.614 + 16.974 + 23.14 + 9.576 = $54 Mil.
Non Operating Income was -0.874 + -2.387 + 9.903 + -0.536 = $6 Mil.
Cash Flow from Operations was 10.019 + 38.725 + 48.223 + 45.693 = $143 Mil.
Accounts Receivable was $268 Mil.
Revenue was 343.584 + 349.832 + 279.983 + 246.837 = $1,220 Mil.
Gross Profit was 124.67 + 116.708 + 104.23 + 90.18 = $436 Mil.
Total Current Assets was $546 Mil.
Total Assets was $1,971 Mil.
Property, Plant and Equipment(Net PPE) was $206 Mil.
Depreciation, Depletion and Amortization(DDA) was $49 Mil.
Selling, General & Admin. Expense(SGA) was $343 Mil.
Total Current Liabilities was $221 Mil.
Long-Term Debt was $705 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)
=(268.071 / 1436.716) / (267.571 / 1220.236)
=0.18658594 / 0.21927807
=0.8509

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)
=(141.574 / 1220.236) / (126.567 / 1436.716)
=0.35713419 / 0.3697822
=0.9658

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 - (584.568 + 226.772) / 2126.2) / (1 - (546.266 + 205.889) / 1971.472)
=0.61840843 / 0.61848051
=0.9999

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
=1436.716 / 1220.236
=1.1774

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))
=(49.028 / (49.028 + 205.889)) / (62.94 / (62.94 + 226.772))
=0.19232927 / 0.21725023
=0.8853

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)
=(439.796 / 1436.716) / (343.36 / 1220.236)
=0.30611199 / 0.28138819
=1.0879

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)
=((901.46 + 223.456) / 2126.2) / ((705.481 + 221.452) / 1971.472)
=0.52907346 / 0.47017305
=1.1253

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
=(54.304 - 6.106 - 142.66) / 2126.2
=-0.0444

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 -2.75 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

Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15
DSRI 0.94320.94851.10021.00241.0330.99731.05830.92931.41730.7794
GMI 0.91791.01490.94871.04510.95931.00581.04661.03321.02010.9555
AQI 1.03911.00220.94441.0470.99761.01640.96890.99221.18740.9826
SGI 1.11891.04671.09240.95391.05241.09371.00171.09451.1231.2887
DEPI 0.93371.04451.28370.8121.03441.01981.02310.96251.01910.7872
SGAI 1.13311.01931.03141.0691.01421.03081.04480.98081.05731.0589
LVGI 0.90460.95841.20870.9350.96461.11791.01111.04931.07251.1031
TATA -0.0019-0.0164-0.0299-0.037-0.0364-0.0248-0.0223-0.0415-0.0213-0.0382
M-score -2.46-2.54-2.54-2.66-2.58-2.55-2.53-2.66-2.03-2.70

Matthews International Corporation Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.92930.85990.95881.03711.41731.26041.04750.96470.77940.8509
GMI 1.03321.03021.02981.00941.02011.01261.00721.01170.95550.9658
AQI 0.99220.96750.96070.92941.18741.19281.19921.2260.98260.9999
SGI 1.09451.08911.04321.04851.1231.23291.34961.39441.28871.1774
DEPI 0.96250.81750.85920.90561.01910.93350.83190.77430.78720.8853
SGAI 0.98080.980.98161.01821.05731.05041.06861.08271.05891.0879
LVGI 1.04930.94080.93170.96281.07251.08831.11381.12291.10311.1253
TATA -0.0408-0.0456-0.0393-0.0343-0.0215-0.0161-0.035-0.043-0.0382-0.0444
M-score -2.65-2.74-2.65-2.59-2.03-2.07-2.27-2.34-2.70-2.75
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