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NACCO Industries Inc (NYSE:NC)
Beneish M-Score
-2.87 (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 -2.87 suggests that the company is not a manipulator.

NC' s Beneish M-Score Range Over the Past 10 Years
Min: -4.88   Max: -1.57
Current: -2.87

-4.88
-1.57

During the past 13 years, the highest Beneish M-Score of NACCO Industries Inc was -1.57. The lowest was -4.88. And the median was -2.58.


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 * 0.8184+0.528 * 1.012+0.404 * 1.2016+0.892 * 0.9808+0.115 * 1.0549
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0045+4.679 * -0.07-0.327 * 0.918
=-2.87

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $73.9 Mil.
Revenue was 173.421 + 286.519 + 239.107 + 196.5 = $895.5 Mil.
Gross Profit was 40.005 + 63.711 + 42.215 + 35.381 = $181.3 Mil.
Total Current Assets was $315.8 Mil.
Total Assets was $606.5 Mil.
Property, Plant and Equipment(Net PPE) was $132.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $22.1 Mil.
Selling, General & Admin. Expense(SGA) was $193.8 Mil.
Total Current Liabilities was $140.8 Mil.
Long-Term Debt was $157.5 Mil.
Net Income was 2.802 + 18.091 + 3.141 + -0.275 = $23.8 Mil.
Non Operating Income was -0.126 + 0.451 + -0.888 + 0.042 = $-0.5 Mil.
Cash Flow from Operations was -3.819 + 48.188 + 9.933 + 12.409 = $66.7 Mil.
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.



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)
=(73.851 / 895.547) / (92.007 / 913.103)
=0.08246468 / 0.100763
=0.8184

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)
=(63.711 / 913.103) / (40.005 / 895.547)
=0.20489474 / 0.2024595
=1.012

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 - (315.766 + 132.345) / 606.514) / (1 - (355.014 + 156.551) / 653.637)
=0.26116957 / 0.21735612
=1.2016

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
=895.547 / 913.103
=0.9808

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))
=(27.849 / (27.849 + 156.551)) / (22.114 / (22.114 + 132.345))
=0.15102495 / 0.14317068
=1.0549

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)
=(193.768 / 895.547) / (196.684 / 913.103)
=0.21636832 / 0.21540177
=1.0045

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)
=((157.468 + 140.797) / 606.514) / ((164.935 + 185.217) / 653.637)
=0.49176936 / 0.53569795
=0.918

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
=(23.759 - -0.521 - 66.711) / 606.514
=-0.07

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 -2.87 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

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.03421.18660.79861.21.16240.87990.99520.93331.06310.8805
GMI 0.96821.00921.2410.75890.90211.09970.68841.09011.14971.053
AQI 0.98710.87130.45891.13210.79070.91161.43681.16461.17911.3074
SGI 1.06071.07581.02150.62781.16311.23950.26221.06790.96151.0213
DEPI 0.96571.03510.97321.040.87751.02451.67130.93780.67390.9865
SGAI 0.97331.01610.94551.30070.94170.88261.72460.88721.03670.9557
LVGI 0.97111.0361.19390.90331.06730.92190.82471.03231.20070.9273
TATA -0.02640.0017-0.263-0.08380.0212-0.0318-0.0399-0.0096-0.0717-0.1311
M-score -2.53-2.29-4.03-3.11-2.25-2.46-3.31-2.41-2.75-3.00

NACCO Industries Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 2.24921.3581.04820.93441.06311.23151.04921.18980.88050.8184
GMI 0.84460.93461.15191.12081.14971.12771.06541.1051.0531.012
AQI 1.16460.97540.94590.91961.17911.29511.30251.30081.30741.2016
SGI 0.44310.61030.99780.97080.96150.9990.991.01661.02130.9808
DEPI 0.93780.73920.38491.11790.67390.61510.64190.67650.98651.0549
SGAI 1.28211.13780.94751.03151.03130.99530.96260.92910.95571.0045
LVGI 1.03231.11011.11431.05431.20071.12891.13911.14730.92730.918
TATA -0.0096-0.0161-0.0043-0.0266-0.0717-0.1782-0.1864-0.1589-0.1311-0.07
M-score -1.95-2.71-2.50-2.67-2.75-3.00-3.24-2.93-3.00-2.87
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