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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.
MasTec Inc has a M-score of -2.33 suggests that the company is not a manipulator.
During the past 13 years, the highest Beneish M-Score of MasTec Inc was -0.58. The lowest was -4.56. And the median was -2.46.
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 MasTec 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 * 1.1845||+||0.528 * 0.9266||+||0.404 * 0.9548||+||0.892 * 1.1185||+||0.115 * 0.9715|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.1623||+||4.679 * -0.0067||-||0.327 * 1.0174|
|This Year (Mar14) TTM:||Last Year (Mar13) TTM:|
|Accounts Receivable was $1,196 Mil.|
Revenue was 964.029 + 1159.13 + 1269.385 + 977.624 = $4,370 Mil.
Gross Profit was 122.975 + 172.05 + 188.253 + 154.969 = $638 Mil.
Total Current Assets was $1,358 Mil.
Total Assets was $3,013 Mil.
Property, Plant and Equipment(Net PPE) was $510 Mil.
Depreciation, Depletion and Amortization(DDA) was $143 Mil.
Selling, General & Admin. Expense(SGA) was $220 Mil.
Total Current Liabilities was $820 Mil.
Long-Term Debt was $841 Mil.
Net Income was 16.023 + 41.501 + 46.138 + 34.941 = $139 Mil.
Non Operating Income was -0.345 + 2.863 + 2.778 + -0.322 = $5 Mil.
Cash Flow from Operations was -20.394 + 75.411 + 110.424 + -11.563 = $154 Mil.
|Accounts Receivable was $902 Mil.
Revenue was 918.648 + 932.358 + 1067.3 + 988.874 = $3,907 Mil.
Gross Profit was 127.149 + 138.219 + 142.996 + 120.37 = $529 Mil.
Total Current Assets was $1,146 Mil.
Total Assets was $2,541 Mil.
Property, Plant and Equipment(Net PPE) was $383 Mil.
Depreciation, Depletion and Amortization(DDA) was $103 Mil.
Selling, General & Admin. Expense(SGA) was $169 Mil.
Total Current Liabilities was $692 Mil.
Long-Term Debt was $685 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(1195.603 / 4370.168)||/||(902.426 / 3907.18)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(172.05 / 3907.18)||/||(122.975 / 4370.168)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (1357.936 + 509.585) / 3013.407)||/||(1 - (1145.749 + 383.174) / 2540.866)|
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.
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))|
|=||(103.4 / (103.4 + 383.174))||/||(142.669 / (142.669 + 509.585))|
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)|
|=||(219.844 / 4370.168)||/||(169.105 / 3907.18)|
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)|
|=||((841.335 + 820.389) / 3013.407)||/||((685.39 + 691.729) / 2540.866)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(138.603 - 4.974||-||153.878)||/||3013.407|
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.
MasTec Inc has a M-score of -2.33 suggests that the company will not be a manipulator.
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
MasTec Inc Annual Data
MasTec Inc Quarterly Data