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Magellan Midstream Partners, L.P. (NYSE:MMP)
Beneish M-Score
-2.33 (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.

Magellan Midstream Partners, L.P. has a M-score of -2.33 suggests that the company is not a manipulator.

MMP' s 10-Year Beneish M-Score Range
Min: -4.75   Max: -1.53
Current: -2.33

-4.75
-1.53

During the past 13 years, the highest Beneish M-Score of Magellan Midstream Partners, L.P. was -1.53. The lowest was -4.75. And the median was -2.54.


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 Magellan Midstream Partners, L.P. 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 * 0.7748+0.528 * 0.8933+0.404 * 1.8975+0.892 * 1.2179+0.115 * 1.0246
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9748+4.679 * -0.0319-0.327 * 1.0176
=-2.33

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $113 Mil.
Revenue was 618.606 + 577.438 + 443.835 + 443.912 = $2,084 Mil.
Gross Profit was 347.069 + 295.222 + 220.274 + 251.169 = $1,114 Mil.
Total Current Assets was $567 Mil.
Total Assets was $5,144 Mil.
Property, Plant and Equipment(Net PPE) was $3,914 Mil.
Depreciation, Depletion and Amortization(DDA) was $143 Mil.
Selling, General & Admin. Expense(SGA) was $137 Mil.
Total Current Liabilities was $604 Mil.
Long-Term Debt was $2,691 Mil.
Net Income was 242.554 + 190.007 + 125.623 + 153.64 = $712 Mil.
Non Operating Income was -0.599 + 1.62 + -0.54 + -0.54 = $-0 Mil.
Cash Flow from Operations was 270.074 + 251.459 + 179.234 + 175.066 = $876 Mil.
Accounts Receivable was $120 Mil.
Revenue was 432.421 + 503.195 + 325.869 + 449.527 = $1,711 Mil.
Gross Profit was 206.842 + 250.612 + 136.778 + 222.703 = $817 Mil.
Total Current Assets was $585 Mil.
Total Assets was $4,406 Mil.
Property, Plant and Equipment(Net PPE) was $3,521 Mil.
Depreciation, Depletion and Amortization(DDA) was $132 Mil.
Selling, General & Admin. Expense(SGA) was $116 Mil.
Total Current Liabilities was $382 Mil.
Long-Term Debt was $2,392 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)
=(113.494 / 2083.791) / (120.276 / 1711.012)
=0.05446516 / 0.07029524
=0.7748

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)
=(295.222 / 1711.012) / (347.069 / 2083.791)
=0.4774572 / 0.53447491
=0.8933

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 - (567.042 + 3913.595) / 5143.782) / (1 - (585.495 + 3520.887) / 4405.713)
=0.12892168 / 0.06794156
=1.8975

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
=2083.791 / 1711.012
=1.2179

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))
=(132.315 / (132.315 + 3520.887)) / (143.409 / (143.409 + 3913.595))
=0.03621891 / 0.0353485
=1.0246

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)
=(137.375 / 2083.791) / (115.715 / 1711.012)
=0.06592552 / 0.06762957
=0.9748

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)
=((2691.288 + 604.15) / 5143.782) / ((2391.718 + 382.073) / 4405.713)
=0.6406644 / 0.62958958
=1.0176

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
=(711.824 - -0.059 - 875.833) / 5143.782
=-0.0319

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.

Magellan Midstream Partners, L.P. has a M-score of -2.33 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.

Magellan Midstream Partners, L.P. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.03370.57361.00661.0450.72651.970.78890.83821.10261.1082
GMI 1.20381.32320.93480.93060.77770.89871.20560.92550.94830.8651
AQI 0.81470.91090.86150.96320.73520.70042.24831.08741.2721.8296
SGI 1.43331.63521.07611.07730.92070.83561.53571.12281.01341.0708
DEPI 1.36120.82290.98591.02910.98071.04351.03320.91961.00911.0165
SGAI 0.67340.65521.02021.0041.09681.37210.73850.9221.09411.131
LVGI 0.9290.98191.02891.01730.91371.22290.97191.03781.03521.0115
TATA -0.0595-0.0351-0.0587-0.0093-0.1443-0.0455-0.0301-0.0405-0.0474-0.0395
M-score -2.19-2.29-2.79-2.47-3.69-2.25-1.67-2.72-2.54-2.26

Magellan Midstream Partners, L.P. Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.83821.00110.92431.13111.10261.09611.11340.95791.10820.7748
GMI 0.92550.92940.95771.02480.94830.8650.84630.81940.86510.8933
AQI 1.08741.11021.10531.2841.2721.42591.67011.72491.82961.8975
SGI 1.12281.0771.14381.05761.01340.9510.91421.03851.07081.2179
DEPI 0.91960.91520.95451.00631.00911.01280.99580.98711.01651.0246
SGAI 0.9220.93970.84151.00721.09411.24391.37981.18051.1310.9748
LVGI 1.03781.0030.99861.00221.03521.04221.03171.03271.01151.0176
TATA -0.0398-0.025-0.0597-0.0406-0.0475-0.0606-0.0405-0.0457-0.0395-0.0319
M-score -2.72-2.52-2.66-2.37-2.54-2.67-2.53-2.54-2.26-2.33
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