Switch to:
NewMarket Corp (NYSE:NEU)
Beneish M-Score
-2.53 (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.

NewMarket Corp has a M-score of -2.53 suggests that the company is not a manipulator.

NEU' s 10-Year Beneish M-Score Range
Min: -3.54   Max: -1.93
Current: -2.53

-3.54
-1.93

During the past 13 years, the highest Beneish M-Score of NewMarket Corp was -1.93. The lowest was -3.54. And the median was -2.68.


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 NewMarket Corp 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 * 0.9371+0.528 * 1.0055+0.404 * 0.9433+0.892 * 1.0241+0.115 * 1.172
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9684+4.679 * 0.0043-0.327 * 1.1245
=-2.53

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $275 Mil.
Revenue was 548.878 + 589.667 + 620.438 + 576.422 = $2,335 Mil.
Gross Profit was 157.528 + 165.219 + 180.746 + 161.93 = $665 Mil.
Total Current Assets was $797 Mil.
Total Assets was $1,232 Mil.
Property, Plant and Equipment(Net PPE) was $308 Mil.
Depreciation, Depletion and Amortization(DDA) was $42 Mil.
Selling, General & Admin. Expense(SGA) was $164 Mil.
Total Current Liabilities was $260 Mil.
Long-Term Debt was $364 Mil.
Net Income was 52.055 + 56.913 + 66.764 + 57.523 = $233 Mil.
Non Operating Income was -3.02 + 0.385 + -2.203 + -2.216 = $-7 Mil.
Cash Flow from Operations was 73.28 + 77.162 + 80.135 + 4.381 = $235 Mil.
Accounts Receivable was $287 Mil.
Revenue was 556.371 + 580.455 + 583.779 + 559.75 = $2,280 Mil.
Gross Profit was 151.638 + 163.823 + 169.428 + 168.407 = $653 Mil.
Total Current Assets was $897 Mil.
Total Assets was $1,327 Mil.
Property, Plant and Equipment(Net PPE) was $285 Mil.
Depreciation, Depletion and Amortization(DDA) was $46 Mil.
Selling, General & Admin. Expense(SGA) was $165 Mil.
Total Current Liabilities was $248 Mil.
Long-Term Debt was $349 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)
=(275.176 / 2335.405) / (286.737 / 2280.355)
=0.11782796 / 0.12574226
=0.9371

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)
=(165.219 / 2280.355) / (157.528 / 2335.405)
=0.28648873 / 0.28492831
=1.0055

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 - (797.191 + 307.859) / 1231.925) / (1 - (897.319 + 285.036) / 1327.274)
=0.10298922 / 0.10918544
=0.9433

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
=2335.405 / 2280.355
=1.0241

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))
=(46.144 / (46.144 + 285.036)) / (41.538 / (41.538 + 307.859))
=0.13933209 / 0.11888482
=1.172

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)
=(163.52 / 2335.405) / (164.878 / 2280.355)
=0.07001783 / 0.07230365
=0.9684

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)
=((363.526 + 259.674) / 1231.925) / ((349.467 + 247.614) / 1327.274)
=0.50587495 / 0.44985512
=1.1245

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
=(233.255 - -7.054 - 234.958) / 1231.925
=0.0043

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.

NewMarket Corp has a M-score of -2.53 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.

NewMarket Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.97960.79891.02380.88651.07690.96150.90830.99871.06360.9371
GMI 1.0710.89070.96911.10940.64221.05571.10270.91240.9951.0055
AQI 0.87450.83710.73891.27120.76651.01591.12521.01030.81020.9433
SGI 1.20291.17461.08831.17640.9461.17471.19591.0291.0311.0241
DEPI 1.11011.17211.1911.32061.09690.90130.95891.01290.77511.172
SGAI 0.83090.96030.9350.89031.04361.01480.92550.98851.03710.9684
LVGI 0.95190.92121.03341.05670.88070.98720.94381.34690.88711.1245
TATA -0.04880.013-0.04170.0635-0.04970.02180.0339-0.0164-0.01540.0043
M-score -2.50-2.52-2.67-1.93-2.93-2.23-2.10-2.68-2.54-2.53

NewMarket Corp Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 0.99751.05811.02451.03851.0650.98981.00380.96660.93710.8828
GMI 0.9110.93420.94510.97890.99651.01341.02291.0171.00550.9534
AQI 1.01031.02830.92470.85270.81020.88231.01131.11980.94330.9074
SGI 1.03031.00350.99771.01371.02961.03851.05691.04721.02411.0094
DEPI 1.01290.9960.7520.76890.77510.8171.20371.16371.1721.1722
SGAI 0.98731.05071.02841.02971.03840.99480.98830.97690.96841.0046
LVGI 1.34691.41611.46831.58850.88710.89750.98661.0821.12451.0971
TATA -0.01640.0111-0.0433-0.0282-0.0154-0.00390.01640.00490.0043-0.038
M-score -2.68-2.54-2.91-2.86-2.54-2.50-2.30-2.39-2.53-2.83
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK