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Micron Technology Inc (NAS:MU)
Beneish M-Score
-2.65 (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 -2.65 suggests that the company is not a manipulator.

MU' s 10-Year Beneish M-Score Range
Min: -14.17   Max: 4.67
Current: -2.65

-14.17
4.67

During the past 13 years, the highest Beneish M-Score of Micron Technology Inc was 4.67. The lowest was -14.17. And the median was -3.00.


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 * 0.7517+0.528 * 0.8673+0.404 * 1.4609+0.892 * 1.2733+0.115 * 0.9503
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8565+4.679 * -0.0787-0.327 * 0.8671
=-2.65

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

This Year (Feb15) TTM:Last Year (Feb14) TTM:
Accounts Receivable was $2,439 Mil.
Revenue was 4166 + 4573 + 4227 + 3982 = $16,948 Mil.
Gross Profit was 1405 + 1638 + 1385 + 1368 = $5,796 Mil.
Total Current Assets was $9,918 Mil.
Total Assets was $23,818 Mil.
Property, Plant and Equipment(Net PPE) was $9,233 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,379 Mil.
Selling, General & Admin. Expense(SGA) was $734 Mil.
Total Current Liabilities was $4,120 Mil.
Long-Term Debt was $5,519 Mil.
Net Income was 934 + 1003 + 1150 + 806 = $3,893 Mil.
Non Operating Income was -6 + -49 + 198 + -21 = $122 Mil.
Cash Flow from Operations was 1251 + 1592 + 1347 + 1455 = $5,645 Mil.
Accounts Receivable was $2,548 Mil.
Revenue was 4107 + 4042 + 2843 + 2318 = $13,310 Mil.
Gross Profit was 1403 + 1281 + 708 + 556 = $3,948 Mil.
Total Current Assets was $9,991 Mil.
Total Assets was $20,615 Mil.
Property, Plant and Equipment(Net PPE) was $7,859 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,900 Mil.
Selling, General & Admin. Expense(SGA) was $673 Mil.
Total Current Liabilities was $5,305 Mil.
Long-Term Debt was $4,317 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)
=(2439 / 16948) / (2548 / 13310)
=0.14391079 / 0.19143501
=0.7517

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)
=(1638 / 13310) / (1405 / 16948)
=0.29661908 / 0.34198726
=0.8673

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 - (9918 + 9233) / 23818) / (1 - (9991 + 7859) / 20615)
=0.19594424 / 0.13412564
=1.4609

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
=16948 / 13310
=1.2733

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))
=(1900 / (1900 + 7859)) / (2379 / (2379 + 9233))
=0.19469208 / 0.20487427
=0.9503

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)
=(734 / 16948) / (673 / 13310)
=0.04330895 / 0.05056349
=0.8565

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)
=((5519 + 4120) / 23818) / ((4317 + 5305) / 20615)
=0.40469393 / 0.46674751
=0.8671

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
=(3893 - 122 - 5645) / 23818
=-0.0787

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 -2.65 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

Aug05Aug06Aug07Aug08Aug09Aug10Aug11Aug12Aug13Aug14
DSRI 0.92580.94080.84881.35990.94040.87850.86150.90122.01250.6766
GMI 1.27151.03091.202-20.12720.1028-0.28631.59951.70160.57750.6125
AQI 0.94082.03810.87360.71021.43151.33710.77291.10651.31861.1757
SGI 1.10811.08031.07891.02690.82231.7661.03610.9371.10191.8029
DEPI 0.96581.191.03980.90690.8041.04511.03490.94081.21070.9811
SGAI 0.88351.30611.22910.72640.94620.84461.08221.11780.82260.6978
LVGI 0.96880.67711.6021.11321.23630.79430.99391.25251.21720.9676
TATA -0.1307-0.1542-0.0906-0.1954-0.2681-0.1182-0.1501-0.2216-0.0987-0.1169
M-score -2.92-2.67-3.15-14.31-4.34-2.91-3.06-3.36-2.03-2.68

Micron Technology Inc Quarterly Data

Nov12Feb13May13Aug13Nov13Feb14May14Aug14Nov14Feb15
DSRI 0.89211.13811.31892.01252.07571.54361.03170.67660.60680.7517
GMI 1.61751.21820.76750.57750.42750.4340.52140.61250.75220.8673
AQI 1.25711.42540.89261.31861.23191.18471.41821.17571.21931.4609
SGI 0.92490.96050.97411.10191.4141.6541.82771.80291.49711.2733
DEPI 1.02121.07921.11421.21071.14711.10891.0620.98110.96970.9503
SGAI 1.05430.8860.820.82260.74450.75770.77550.69780.78130.8565
LVGI 1.34231.29051.11741.21721.17481.19851.08780.96760.90350.8671
TATA -0.2166-0.1808-0.1456-0.0987-0.1265-0.13-0.1353-0.1169-0.0932-0.0787
M-score -3.35-3.01-3.05-2.03-1.92-2.24-2.41-2.68-2.81-2.65
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