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M/A-COM Technology Solutions Holdings Inc (NAS:MTSI)
Beneish M-Score
-2.31 (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.

M/A-COM Technology Solutions Holdings Inc has a M-score of -2.31 suggests that the company is not a manipulator.

MTSI' s 10-Year Beneish M-Score Range
Min: -2.66   Max: -1.3
Current: -2.31

-2.66
-1.3

During the past 6 years, the highest Beneish M-Score of M/A-COM Technology Solutions Holdings Inc was -1.30. The lowest was -2.66. 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 M/A-COM Technology Solutions Holdings 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 * 0.9499+0.528 * 0.8303+0.404 * 1.3283+0.892 * 1.246+0.115 * 1.2439
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.03+4.679 * -0.0305-0.327 * 0.7792
=-2.31

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $89.7 Mil.
Revenue was 130.663 + 124.885 + 114.864 + 114.317 = $484.7 Mil.
Gross Profit was 59.784 + 54.007 + 54.201 + 56.189 = $224.2 Mil.
Total Current Assets was $309.2 Mil.
Total Assets was $806.7 Mil.
Property, Plant and Equipment(Net PPE) was $80.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $53.2 Mil.
Selling, General & Admin. Expense(SGA) was $102.5 Mil.
Total Current Liabilities was $65.7 Mil.
Long-Term Debt was $341.4 Mil.
Net Income was 8.027 + -7.537 + -6.306 + 14.537 = $8.7 Mil.
Non Operating Income was 4.321 + -6.985 + -10.233 + 2.414 = $-10.5 Mil.
Cash Flow from Operations was 12.177 + 13.935 + 2.083 + 15.63 = $43.8 Mil.
Accounts Receivable was $75.8 Mil.
Revenue was 112.364 + 107.827 + 84.154 + 84.675 = $389.0 Mil.
Gross Profit was 50.214 + 26.863 + 35.722 + 36.59 = $149.4 Mil.
Total Current Assets was $365.9 Mil.
Total Assets was $679.3 Mil.
Property, Plant and Equipment(Net PPE) was $48.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $48.1 Mil.
Selling, General & Admin. Expense(SGA) was $79.9 Mil.
Total Current Liabilities was $96.0 Mil.
Long-Term Debt was $343.9 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)
=(89.714 / 484.729) / (75.795 / 389.02)
=0.18508074 / 0.19483574
=0.9499

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)
=(54.007 / 389.02) / (59.784 / 484.729)
=0.38401368 / 0.46248729
=0.8303

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 - (309.154 + 80.167) / 806.714) / (1 - (365.864 + 48.86) / 679.334)
=0.51739898 / 0.38951385
=1.3283

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
=484.729 / 389.02
=1.246

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))
=(48.109 / (48.109 + 48.86)) / (53.191 / (53.191 + 80.167))
=0.49612763 / 0.39885871
=1.2439

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)
=(102.481 / 484.729) / (79.85 / 389.02)
=0.21141916 / 0.20525937
=1.03

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)
=((341.421 + 65.654) / 806.714) / ((343.938 + 95.985) / 679.334)
=0.50460882 / 0.64757984
=0.7792

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
=(8.721 - -10.483 - 43.825) / 806.714
=-0.0305

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.

M/A-COM Technology Solutions Holdings Inc has a M-score of -2.31 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.

M/A-COM Technology Solutions Holdings Inc Annual Data

Sep09Sep10Sep11Sep12Sep13Sep14
DSRI 1.09670.9129
GMI 1.05721.0461
AQI 1.2773.2037
SGI 1.06911.2959
DEPI 0.93930.6096
SGAI 1.08691.2788
LVGI 0.79243.8158
TATA -0.0214-0.0585
M-score -2.24-2.67

M/A-COM Technology Solutions Holdings Inc Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.07191.10031.17091.16061.1010.90990.88091.01580.9499
GMI 1.06491.04781.05081.15551.10321.05551.01810.81280.8303
AQI 0.7121.2775.27265.80995.25323.20371.2081.11841.3283
SGI 1.01781.06551.08871.17871.24731.30021.3571.29521.246
DEPI 0.77330.93931.19640.72320.69460.60960.52291.09031.2439
SGAI 1.0891.081.24331.29711.29771.2871.13441.05271.03
LVGI 0.7390.79243.16843.63473.9113.81581.20050.86860.7792
TATA -0.025-0.0149-0.0288-0.0453-0.047-0.0585-0.0327-0.0343-0.0305
M-score -2.55-2.21-1.35-1.30-1.65-2.66-2.47-2.37-2.31
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