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Mueller Industries Inc (NYSE:MLI)
Beneish M-Score
-2.50 (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.

Mueller Industries Inc has a M-score of -2.50 suggests that the company is not a manipulator.

MLI' s Beneish M-Score Range Over the Past 10 Years
Min: -4.05   Max: -1.43
Current: -2.5

-4.05
-1.43

During the past 13 years, the highest Beneish M-Score of Mueller Industries Inc was -1.43. The lowest was -4.05. And the median was -2.50.


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 Mueller Industries 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 * 0.9947+0.528 * 0.9553+0.404 * 1.836+0.892 * 0.9005+0.115 * 1.0638
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0983+4.679 * -0.0535-0.327 * 0.9268
=-2.50

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $276 Mil.
Revenue was 532.809 + 471.983 + 535.184 + 555.593 = $2,096 Mil.
Gross Profit was 86.167 + 60.647 + 68.017 + 85.228 = $300 Mil.
Total Current Assets was $821 Mil.
Total Assets was $1,361 Mil.
Property, Plant and Equipment(Net PPE) was $278 Mil.
Depreciation, Depletion and Amortization(DDA) was $36 Mil.
Selling, General & Admin. Expense(SGA) was $137 Mil.
Total Current Liabilities was $203 Mil.
Long-Term Debt was $206 Mil.
Net Income was 28.63 + 14.435 + 17.8 + 33.651 = $95 Mil.
Non Operating Income was 0.245 + 0.625 + 0.164 + 0.265 = $1 Mil.
Cash Flow from Operations was 10.336 + 64.141 + 78.318 + 13.26 = $166 Mil.
Accounts Receivable was $308 Mil.
Revenue was 537.242 + 537.342 + 602.82 + 649.691 = $2,327 Mil.
Gross Profit was 76.408 + 68.453 + 81.542 + 91.916 = $318 Mil.
Total Current Assets was $941 Mil.
Total Assets was $1,325 Mil.
Property, Plant and Equipment(Net PPE) was $245 Mil.
Depreciation, Depletion and Amortization(DDA) was $34 Mil.
Selling, General & Admin. Expense(SGA) was $138 Mil.
Total Current Liabilities was $224 Mil.
Long-Term Debt was $205 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)
=(275.881 / 2095.569) / (307.984 / 2327.095)
=0.13164969 / 0.13234698
=0.9947

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)
=(60.647 / 2327.095) / (86.167 / 2095.569)
=0.13678814 / 0.14318736
=0.9553

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 - (820.761 + 278.481) / 1361.02) / (1 - (941.131 + 244.909) / 1324.83)
=0.19233957 / 0.10476061
=1.836

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
=2095.569 / 2327.095
=0.9005

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))
=(33.585 / (33.585 + 244.909)) / (35.604 / (35.604 + 278.481))
=0.12059506 / 0.11335785
=1.0638

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)
=(136.749 / 2095.569) / (138.267 / 2327.095)
=0.06525626 / 0.05941614
=1.0983

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)
=((206 + 202.608) / 1361.02) / ((205 + 224.16) / 1324.83)
=0.30022189 / 0.3239359
=0.9268

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
=(94.516 - 1.299 - 166.055) / 1361.02
=-0.0535

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.

Mueller Industries Inc has a M-score of -2.50 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.

Mueller Industries Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.78131.06730.71511.72680.88420.79111.19711.01740.92381.0297
GMI 1.0841.15671.08710.89351.02871.10720.95860.94921.01310.9807
AQI 0.83320.98810.92380.80170.90850.93411.28860.91991.031.8167
SGI 1.45151.07440.94830.60481.33131.17380.90580.98571.09530.8882
DEPI 1.00150.93030.90370.97580.95560.97621.2881.01670.96991.0974
SGAI 0.76240.9461.00741.40930.84480.88271.06651.04230.94091.0834
LVGI 0.87090.95810.71570.95030.96960.97751.53830.8080.97880.9257
TATA 0.0672-0.0502-0.0928-0.06140.0264-0.0515-0.02390.03250.0089-0.0545
M-score -1.90-2.49-3.13-2.64-2.16-2.70-2.55-2.33-2.39-2.47

Mueller Industries Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.01741.0261.15830.99840.92380.89910.83870.96251.02970.9947
GMI 0.94920.93220.9660.99021.01311.00320.98810.99780.98070.9553
AQI 0.91991.10621.151.31631.030.87430.96981.70361.81671.836
SGI 0.98571.00061.03731.06431.09531.07080.99660.93550.88820.9005
DEPI 1.01671.03211.01911.05360.96990.96991.03941.10861.09741.0638
SGAI 1.03051.02350.97970.96270.93130.95121.03251.06411.09461.0983
LVGI 0.8080.8050.950.92440.97880.94140.87730.95610.92570.9268
TATA 0.03250.0560.06390.02750.0089-0.0298-0.045-0.0653-0.0545-0.0535
M-score -2.32-2.12-1.94-2.14-2.39-2.67-2.82-2.58-2.47-2.50
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