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Beneish M-Score
-5.24 (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.

Matador Resources Co has a M-score of -5.24 suggests that the company is not a manipulator.

MTDR' s Beneish M-Score Range Over the Past 10 Years
Min: -5.95   Max: 10000000
Current: -5.24

-5.95
10000000

During the past 7 years, the highest Beneish M-Score of Matador Resources Co was 10000000.00. The lowest was -5.95. And the median was -3.22.

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 Matador Resources Co 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 * 1.187 + 0.528 * 1.2896 + 0.404 * 0.0882 + 0.892 * 0.6046 + 0.115 * 1.3701 - 0.172 * SGAI + 4.679 * TATA - 0.327 * LVGI - 0.172 * 1.7878 + 4.679 * -0.4708 - 0.327 * 1.2163 = -5.24

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

 This Year (Sep16) TTM: Last Year (Sep15) TTM: Accounts Receivable was \$33.4 Mil. Revenue was 88.733 + 45.176 + 44.15 + 65.867 = \$243.9 Mil. Gross Profit was 60.291 + 21.446 + 20.759 + 41.785 = \$144.3 Mil. Total Current Assets was \$81.0 Mil. Total Assets was \$1,177.7 Mil. Property, Plant and Equipment(Net PPE) was \$1,095.7 Mil. Depreciation, Depletion and Amortization(DDA) was \$125.6 Mil. Selling, General & Admin. Expense(SGA) was \$51.1 Mil. Total Current Liabilities was \$151.6 Mil. Long-Term Debt was \$457.2 Mil. Net Income was 11.931 + -105.853 + -107.654 + -230.401 = \$-432.0 Mil. Non Operating Income was 0.932 + 1.002 + 1.065 + 0.368 = \$3.4 Mil. Cash Flow from Operations was 46.862 + 31.242 + 18.358 + 22.611 = \$119.1 Mil. Accounts Receivable was \$46.5 Mil. Revenue was 98.979 + 78.096 + 72.412 + 153.939 = \$403.4 Mil. Gross Profit was 74.637 + 52.888 + 52.317 + 127.9 = \$307.7 Mil. Total Current Assets was \$126.5 Mil. Total Assets was \$1,280.5 Mil. Property, Plant and Equipment(Net PPE) was \$1,142.0 Mil. Depreciation, Depletion and Amortization(DDA) was \$187.2 Mil. Selling, General & Admin. Expense(SGA) was \$47.3 Mil. Total Current Liabilities was \$153.3 Mil. Long-Term Debt was \$391.0 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of daysÂ’ 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) = (33.396 / 243.926) / (46.53 / 403.426) = 0.13691037 / 0.11533714 = 1.187

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) = (307.742 / 403.426) / (144.281 / 243.926) = 0.76282143 / 0.59149496 = 1.2896

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 - (81.02 + 1095.705) / 1177.693) / (1 - (126.54 + 1142.047) / 1280.522) = 0.00082195 / 0.00932042 = 0.0882

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 = 243.926 / 403.426 = 0.6046

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)) = (187.244 / (187.244 + 1142.047)) / (125.555 / (125.555 + 1095.705)) = 0.14086005 / 0.10280776 = 1.3701

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) = (51.088 / 243.926) / (47.26 / 403.426) = 0.20944057 / 0.11714664 = 1.7878

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) = ((457.153 + 151.629) / 1177.693) / ((390.959 + 153.281) / 1280.522) = 0.51692759 / 0.42501417 = 1.2163

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 = (-431.977 - 3.367 - 119.073) / 1177.693 = -0.4708

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.

Matador Resources Co has a M-score of -5.24 suggests that the company will not be a manipulator.

Related Terms

Historical Data

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