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Magellan Midstream Partners LP (NYSE:MMP)
Beneish M-Score
-2.66 (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 LP has a M-score of -2.66 suggests that the company is not a manipulator.

MMP' s Beneish M-Score Range Over the Past 10 Years
Min: -3.76   Max: 7.94
Current: -2.66

-3.76
7.94

During the past 13 years, the highest Beneish M-Score of Magellan Midstream Partners LP was 7.94. The lowest was -3.76. And the median was -2.31.


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 LP 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 * 1.0493+0.528 * 0.971+0.404 * 0.8997+0.892 * 1.018+0.115 * 1.1346
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.007+4.679 * -0.0425-0.327 * 1.0156
=-2.66

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $114 Mil.
Revenue was 577.232 + 487.543 + 522.09 + 667.07 = $2,254 Mil.
Gross Profit was 353.804 + 261.603 + 287.416 + 357.705 = $1,261 Mil.
Total Current Assets was $358 Mil.
Total Assets was $5,966 Mil.
Property, Plant and Equipment(Net PPE) was $4,681 Mil.
Depreciation, Depletion and Amortization(DDA) was $163 Mil.
Selling, General & Admin. Expense(SGA) was $150 Mil.
Total Current Liabilities was $469 Mil.
Long-Term Debt was $3,407 Mil.
Net Income was 252.706 + 177.391 + 183.636 + 244.489 = $858 Mil.
Non Operating Income was -2.346 + 5.899 + -0.866 + -9.139 = $-6 Mil.
Cash Flow from Operations was 309.285 + 223.736 + 191.083 + 393.986 = $1,118 Mil.
Accounts Receivable was $106 Mil.
Revenue was 521.601 + 496.446 + 618.606 + 577.438 = $2,214 Mil.
Gross Profit was 297.623 + 262.469 + 347.069 + 295.222 = $1,202 Mil.
Total Current Assets was $402 Mil.
Total Assets was $5,311 Mil.
Property, Plant and Equipment(Net PPE) was $3,992 Mil.
Depreciation, Depletion and Amortization(DDA) was $159 Mil.
Selling, General & Admin. Expense(SGA) was $146 Mil.
Total Current Liabilities was $394 Mil.
Long-Term Debt was $3,004 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)
=(113.76 / 2253.935) / (106.495 / 2214.091)
=0.05047173 / 0.04809875
=1.0493

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)
=(261.603 / 2214.091) / (353.804 / 2253.935)
=0.54305943 / 0.55925659
=0.971

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 - (358.156 + 4680.65) / 5966.183) / (1 - (401.98 + 3991.746) / 5311.396)
=0.15543891 / 0.17277379
=0.8997

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
=2253.935 / 2214.091
=1.018

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))
=(158.904 / (158.904 + 3991.746)) / (163.459 / (163.459 + 4680.65))
=0.03828412 / 0.03374387
=1.1346

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)
=(149.719 / 2253.935) / (146.044 / 2214.091)
=0.06642561 / 0.06596116
=1.007

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)
=((3407.114 + 468.562) / 5966.183) / ((3003.707 + 393.653) / 5311.396)
=0.64960729 / 0.63963598
=1.0156

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
=(858.222 - -6.452 - 1118.09) / 5966.183
=-0.0425

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 LP has a M-score of -2.66 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 LP Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.88371.120.64682.32780.82260.7971.23731.04990.5983
GMI 0.93480.92780.780.89871.20560.92550.94830.86510.9344
AQI 0.86150.96320.73520.70042.24831.08741.2721.82961.3512
SGI 1.07611.0780.92010.83561.53571.12281.01341.07081.214
DEPI 0.97960.82831.17891.03471.03320.91961.00911.01650.9731
SGAI 1.02021.03471.06431.37210.73850.9221.09411.1310.9219
LVGI 1.02891.01730.91371.22290.97191.03781.03521.01151.0004
TATA -0.0556-0.1119-0.1446-0.0455-0.0301-0.0405-0.0472-0.0391-0.0466
M-score -2.88-2.91-3.74-1.93-1.64-2.76-2.41-2.31-2.76

Magellan Midstream Partners LP Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 12.35921.04990.69150.84450.76570.59830.90130.89791.0493
GMI 0.81940.86510.89330.94130.93810.93440.97880.96120.971
AQI 1.72491.82961.89752.02591.80421.35121.12070.91870.8997
SGI 1.03851.07081.21791.25271.21431.2141.05921.0291.018
DEPI 0.99621.01651.02460.95880.94030.97310.97261.12571.1346
SGAI 1.18051.1310.97480.92660.9340.92191.0230.99931.007
LVGI 1.03271.01151.01761.02561.01061.00041.00321.01831.0156
TATA -0.0467-0.0391-0.0315-0.0398-0.0335-0.0475-0.0431-0.0407-0.0425
M-score 7.94-2.31-2.41-2.20-2.37-2.76-2.69-2.78-2.66
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