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Micron Technology Inc (NAS:MU)
Beneish M-Score
-3.14 (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.

Micron Technology Inc has a M-score of -3.14 suggests that the company is not a manipulator.

MU' s Beneish M-Score Range Over the Past 10 Years
Min: -14.31   Max: 4.67
Current: -3.14

-14.31
4.67

During the past 13 years, the highest Beneish M-Score of Micron Technology Inc was 4.67. The lowest was -14.31. And the median was -2.98.


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 Micron Technology 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 * 1.0196+0.528 * 1.4774+0.404 * 0.6503+0.892 * 0.76+0.115 * 1.1038
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.213+4.679 * -0.1078-0.327 * 1.1389
=-3.14

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

This Year (May16) TTM:Last Year (May15) TTM:
Accounts Receivable was $1,752 Mil.
Revenue was 2898 + 2934 + 3350 + 3600 = $12,782 Mil.
Gross Profit was 498 + 579 + 849 + 970 = $2,896 Mil.
Total Current Assets was $10,110 Mil.
Total Assets was $27,001 Mil.
Property, Plant and Equipment(Net PPE) was $13,209 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,976 Mil.
Selling, General & Admin. Expense(SGA) was $672 Mil.
Total Current Liabilities was $4,500 Mil.
Long-Term Debt was $8,919 Mil.
Net Income was -215 + -97 + 206 + 471 = $365 Mil.
Non Operating Income was -34 + -6 + -4 + 18 = $-26 Mil.
Cash Flow from Operations was 389 + 763 + 1120 + 1030 = $3,302 Mil.
Accounts Receivable was $2,261 Mil.
Revenue was 3853 + 4166 + 4573 + 4227 = $16,819 Mil.
Gross Profit was 1202 + 1405 + 1638 + 1385 = $5,630 Mil.
Total Current Assets was $10,008 Mil.
Total Assets was $25,136 Mil.
Property, Plant and Equipment(Net PPE) was $9,857 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,510 Mil.
Selling, General & Admin. Expense(SGA) was $729 Mil.
Total Current Liabilities was $4,566 Mil.
Long-Term Debt was $6,403 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)
=(1752 / 12782) / (2261 / 16819)
=0.13706775 / 0.1344313
=1.0196

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)
=(5630 / 16819) / (2896 / 12782)
=0.33474047 / 0.22656861
=1.4774

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 - (10110 + 13209) / 27001) / (1 - (10008 + 9857) / 25136)
=0.13636532 / 0.20969924
=0.6503

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
=12782 / 16819
=0.76

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))
=(2510 / (2510 + 9857)) / (2976 / (2976 + 13209))
=0.20295949 / 0.18387396
=1.1038

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)
=(672 / 12782) / (729 / 16819)
=0.05257393 / 0.04334384
=1.213

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)
=((8919 + 4500) / 27001) / ((6403 + 4566) / 25136)
=0.49698159 / 0.43638606
=1.1389

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
=(365 - -26 - 3302) / 27001
=-0.1078

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.

Micron Technology Inc has a M-score of -3.14 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.

Micron Technology Inc Annual Data

Aug06Aug07Aug08Aug09Aug10Aug11Aug12Aug13Aug14Aug15
DSRI 0.94080.84881.35990.94040.87850.86150.90122.01250.67660.8758
GMI 1.03091.202-20.12720.103-0.28571.59951.70160.57750.61251.032
AQI 2.03810.87360.71021.43761.33140.77291.10651.31861.17571.3029
SGI 1.08031.07891.02690.82231.7661.03610.9371.10191.80290.9899
DEPI 1.191.03980.90690.81680.99581.06910.94081.21070.98110.9666
SGAI 1.30611.22910.72640.94620.84461.08221.11780.82260.69781.0274
LVGI 0.67711.6021.11321.32210.74270.99391.25251.21720.96760.9692
TATA -0.1324-0.0854-0.1954-0.2641-0.1182-0.1501-0.222-0.0987-0.1169-0.0934
M-score -2.57-3.12-14.31-4.34-2.90-3.06-3.36-2.03-2.68-2.90

Micron Technology Inc Quarterly Data

Feb14May14Aug14Nov14Feb15May15Aug15Nov15Feb16May16
DSRI 1.54361.03170.67660.60680.75170.8540.87580.95080.85691.0196
GMI 0.4340.52140.61250.75220.86730.94961.0321.16031.3051.4774
AQI 1.18471.41821.17571.21931.46091.55211.30291.19140.86260.6503
SGI 1.6541.82771.80291.49711.27331.12320.98990.88630.81050.76
DEPI 1.10891.0620.98110.96970.95030.98340.96660.99131.04161.1038
SGAI 0.75770.77550.69780.78130.85650.90141.02741.09871.16481.213
LVGI 1.19851.08780.96760.90350.86711.00530.96921.05991.08571.1389
TATA -0.13-0.1353-0.1169-0.0932-0.0787-0.0825-0.0934-0.1077-0.1277-0.1078
M-score -2.24-2.41-2.68-2.81-2.65-2.68-2.90-3.01-3.32-3.14
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