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Nacco Industries Inc (NYSE:NC)
Beneish M-Score
-3.00 (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.

Nacco Industries Inc has a M-score of -3.00 suggests that the company is not a manipulator.

NC' s 10-Year Beneish M-Score Range
Min: -4.82   Max: 21.86
Current: -3

-4.82
21.86

During the past 13 years, the highest Beneish M-Score of Nacco Industries Inc was 21.86. The lowest was -4.82. And the median was -2.62.


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 Nacco Industries 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 * 1.2315+0.528 * 1.1277+0.404 * 1.2951+0.892 * 0.999+0.115 * 0.6151
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9971+4.679 * -0.1782-0.327 * 1.1289
=-3.00

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $92.0 Mil.
Revenue was 193.734 + 297.285 + 221.714 + 200.37 = $913.1 Mil.
Gross Profit was 38.189 + 65.835 + 46.543 + 36.523 = $187.1 Mil.
Total Current Assets was $355.0 Mil.
Total Assets was $653.6 Mil.
Property, Plant and Equipment(Net PPE) was $156.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $27.8 Mil.
Selling, General & Admin. Expense(SGA) was $196.7 Mil.
Total Current Liabilities was $185.2 Mil.
Long-Term Debt was $164.9 Mil.
Net Income was 1.027 + -40.669 + 7.699 + -3.624 = $-35.6 Mil.
Non Operating Income was 0.291 + -1.982 + -0.211 + -0.455 = $-2.4 Mil.
Cash Flow from Operations was 37.472 + 17.581 + 23.63 + 4.604 = $83.3 Mil.
Accounts Receivable was $74.8 Mil.
Revenue was 177.413 + 311.983 + 228.614 + 196.017 = $914.0 Mil.
Gross Profit was 36.171 + 78.181 + 49.219 + 47.63 = $211.2 Mil.
Total Current Assets was $403.2 Mil.
Total Assets was $780.0 Mil.
Property, Plant and Equipment(Net PPE) was $245.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $25.2 Mil.
Selling, General & Admin. Expense(SGA) was $197.5 Mil.
Total Current Liabilities was $202.1 Mil.
Long-Term Debt was $168.1 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)
=(92.007 / 913.103) / (74.788 / 914.027)
=0.100763 / 0.08182253
=1.2315

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)
=(65.835 / 914.027) / (38.189 / 913.103)
=0.23106648 / 0.20489474
=1.1277

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 - (355.014 + 156.551) / 653.637) / (1 - (403.237 + 245.858) / 780)
=0.21735612 / 0.16782692
=1.2951

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
=913.103 / 914.027
=0.999

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))
=(25.179 / (25.179 + 245.858)) / (27.849 / (27.849 + 156.551))
=0.09289876 / 0.15102495
=0.6151

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)
=(196.684 / 913.103) / (197.464 / 914.027)
=0.21540177 / 0.21603738
=0.9971

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)
=((164.935 + 185.217) / 653.637) / ((168.069 + 202.061) / 780)
=0.53569795 / 0.47452564
=1.1289

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
=(-35.567 - -2.357 - 83.287) / 653.637
=-0.1782

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.

Nacco Industries Inc has a M-score of -3.00 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.

Nacco Industries Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.91761.03421.18660.80191.19513.52760.25441.13380.93361.0631
GMI 1.05620.96821.00921.24150.75870.63481.04921.0251.09031.1497
AQI 0.96560.98710.87130.45891.11720.80131.71760.76241.16491.1791
SGI 1.13471.06071.07581.01730.63040.38330.89251.1051.06790.9615
DEPI 0.97350.96571.03510.99570.96072.23330.4771.57530.88830.6739
SGAI 0.92970.97331.01610.9491.29591.31561.09870.97830.89931.0367
LVGI 1.0020.97111.0361.19390.90331.06730.86910.87491.03231.2007
TATA -0.0271-0.0574-0.0144-0.263-0.08380.0224-0.0276-0.0397-0.0096-0.0717
M-score -2.54-2.67-2.37-4.02-3.13-0.81-3.11-2.42-2.42-2.75

Nacco Industries Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 2.90480.32870.17240.90960.93360.81221.04810.93441.06311.2315
GMI 0.76980.8491.06551.09931.09031.09521.15211.12131.14971.1277
AQI 0.76241.94111.87611.14441.16490.97540.94590.91961.17911.2951
SGI 0.43130.61641.13111.13241.06791.02040.99790.97080.96150.999
DEPI 1.57530.34370.00260.76660.88831.05281.07991.07170.67390.6151
SGAI 1.47241.28550.94670.8880.89670.92570.95691.03821.03670.9971
LVGI 0.87490.80080.82430.9971.03231.11011.11431.05431.20071.1289
TATA -0.0397-0.0333-0.0208-0.0278-0.0096-0.0161-0.0043-0.0266-0.0717-0.1782
M-score -1.61-3.35-2.88-2.47-2.42-2.69-2.42-2.68-2.75-3.00
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