Switch to:
GuruFocus has detected 7 Warning Signs with Marvell Technology Group Ltd $MRVL.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Marvell Technology Group Ltd (NAS:MRVL)
Beneish M-Score
-1.82 (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.

Marvell Technology Group Ltd has a M-score of -1.82 signals that the company is a manipulator.

MRVL' s Beneish M-Score Range Over the Past 10 Years
Min: -3.88   Max: -1.82
Current: -1.82

-3.88
-1.82

During the past 13 years, the highest Beneish M-Score of Marvell Technology Group Ltd was -1.82. The lowest was -3.88. And the median was -2.63.


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 Marvell Technology Group Ltd 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 * 1.1573+0.528 * 0.8567+0.404 * 1.1935+0.892 * 0.8216+0.115 * 0.9062
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1228+4.679 * 0.1106-0.327 * 0.4433
=-1.82

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Oct16) TTM:Last Year (Oct15) TTM:
Accounts Receivable was $362 Mil.
Revenue was 654.422 + 626.404 + 540.822 + 616.158 = $2,438 Mil.
Gross Profit was 368.359 + 338.796 + 281.612 + 313.548 = $1,302 Mil.
Total Current Assets was $2,261 Mil.
Total Assets was $4,754 Mil.
Property, Plant and Equipment(Net PPE) was $266 Mil.
Depreciation, Depletion and Amortization(DDA) was $116 Mil.
Selling, General & Admin. Expense(SGA) was $258 Mil.
Total Current Liabilities was $503 Mil.
Long-Term Debt was $0 Mil.
Net Income was 72.616 + 51.305 + -22.679 + 4.2 = $105 Mil.
Non Operating Income was 0 + 3.188 + -1.836 + 2.409 = $4 Mil.
Cash Flow from Operations was 121.461 + 10.859 + -609.601 + 53.306 = $-424 Mil.
Accounts Receivable was $381 Mil.
Revenue was 674.89 + 710.492 + 724.288 + 857.452 = $2,967 Mil.
Gross Profit was 295.636 + 248.773 + 373.135 + 440.321 = $1,358 Mil.
Total Current Assets was $3,035 Mil.
Total Assets was $5,507 Mil.
Property, Plant and Equipment(Net PPE) was $310 Mil.
Depreciation, Depletion and Amortization(DDA) was $117 Mil.
Selling, General & Admin. Expense(SGA) was $280 Mil.
Total Current Liabilities was $1,315 Mil.
Long-Term Debt was $0 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)
=(362.195 / 2437.806) / (380.928 / 2967.122)
=0.14857417 / 0.12838299
=1.1573

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)
=(1357.865 / 2967.122) / (1302.315 / 2437.806)
=0.45763706 / 0.53421601
=0.8567

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 - (2261.141 + 265.984) / 4754.446) / (1 - (3035.489 + 309.647) / 5506.524)
=0.4684712 / 0.39251404
=1.1935

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
=2437.806 / 2967.122
=0.8216

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))
=(117.166 / (117.166 + 309.647)) / (115.591 / (115.591 + 265.984))
=0.27451366 / 0.30293127
=0.9062

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)
=(258.498 / 2437.806) / (280.211 / 2967.122)
=0.10603715 / 0.09443865
=1.1228

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)
=((0 + 503.247) / 4754.446) / ((0 + 1314.948) / 5506.524)
=0.10584766 / 0.2387982
=0.4433

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
=(105.442 - 3.761 - -423.975) / 4754.446
=0.1106

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.

Marvell Technology Group Ltd has a M-score of -1.82 signals that the company is likely to 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 local exchange's currency.

Marvell Technology Group Ltd Annual Data

Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16
DSRI 0.99950.78180.65631.68821.00090.94370.86831.27810.85251.0445
GMI 1.05261.05330.93430.91750.95081.04241.07441.0341.01721.1129
AQI 1.21260.95570.96520.8190.78281.11721.09550.94520.90341.0932
SGI 1.33961.29371.01930.95161.28640.93940.93391.07441.08890.7353
DEPI 1.22850.77220.95261.07621.15761.23080.94980.95321.08970.9785
SGAI 1.74420.93180.75751.20880.65111.06341.11310.8860.97781.3645
LVGI 2.43960.86670.43431.14430.94621.01121.13021.08020.86792.0795
TATA -0.0772-0.0641-0.1208-0.0886-0.0457-0.0271-0.081-0.0277-0.0521-0.1873
M-score -3.00-2.68-3.17-2.50-2.46-2.63-3.03-2.30-2.75-3.87

Marvell Technology Group Ltd Quarterly Data

Jul14Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16Oct16
DSRI 0.94750.81910.85250.79550.98361.09081.04450.97371.09421.1573
GMI 1.06571.04841.01720.97541.03541.08491.11291.13840.95380.8567
AQI 0.86770.89310.90340.94851.00891.03441.09321.27341.22141.1935
SGI 1.22111.16421.08890.95740.85190.78470.73530.73190.76290.8216
DEPI 0.99671.04331.08971.09061.07011.01620.97850.9770.91090.9062
SGAI 0.78650.82980.97931.13341.28261.36381.36251.26741.21651.1228
LVGI 1.04320.85210.86790.75931.78981.982.07950.98630.44260.4433
TATA -0.0442-0.0434-0.0522-0.0372-0.1749-0.1901-0.1881-0.08340.09540.1106
M-score -2.53-2.64-2.75-2.85-3.72-3.80-3.88-2.99-1.96-1.82
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK