Switch to:
GuruFocus has detected 6 Warning Signs with NGL Energy Partners LP $NGL.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
NGL Energy Partners LP (NYSE:NGL)
Beneish M-Score
-2.26 (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.

NGL Energy Partners LP has a M-score of -2.26 suggests that the company is not a manipulator.

NGL' s Beneish M-Score Range Over the Past 10 Years
Min: -3.97   Max: 1.85
Current: -2.26

-3.97
1.85

During the past 8 years, the highest Beneish M-Score of NGL Energy Partners LP was 1.85. The lowest was -3.97. And the median was -1.59.


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 NGL Energy Partners LP 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 * 1.446+0.528 * 1.2266+0.404 * 0.9394+0.892 * 0.91+0.115 * 0.9581
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8466+4.679 * -0.0457-0.327 * 1.0449
=-2.26

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $765 Mil.
Revenue was 3406.641 + 3045.538 + 2721.97 + 2325.44 = $11,500 Mil.
Gross Profit was 178.619 + 116.808 + 155.53 + 248.28 = $699 Mil.
Total Current Assets was $1,563 Mil.
Total Assets was $6,378 Mil.
Property, Plant and Equipment(Net PPE) was $1,747 Mil.
Depreciation, Depletion and Amortization(DDA) was $232 Mil.
Selling, General & Admin. Expense(SGA) was $431 Mil.
Total Current Liabilities was $967 Mil.
Long-Term Debt was $3,217 Mil.
Net Income was 0.976 + -66.599 + 176.92 + -391.229 = $-280 Mil.
Non Operating Income was 19.365 + 1.075 + 19.753 + 30.697 = $71 Mil.
Cash Flow from Operations was -61.266 + 15.023 + -71.422 + 58.361 = $-59 Mil.
Accounts Receivable was $582 Mil.
Revenue was 2685.006 + 3193.195 + 3538.469 + 3220.771 = $12,637 Mil.
Gross Profit was 251.506 + 187.369 + 215.918 + 287.75 = $943 Mil.
Total Current Assets was $1,230 Mil.
Total Assets was $6,564 Mil.
Property, Plant and Equipment(Net PPE) was $1,973 Mil.
Depreciation, Depletion and Amortization(DDA) was $249 Mil.
Selling, General & Admin. Expense(SGA) was $560 Mil.
Total Current Liabilities was $797 Mil.
Long-Term Debt was $3,323 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)
=(765.29 / 11499.589) / (581.621 / 12637.441)
=0.06654933 / 0.04602364
=1.446

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)
=(942.543 / 12637.441) / (699.237 / 11499.589)
=0.07458337 / 0.06080539
=1.2266

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 - (1562.703 + 1746.925) / 6378.076) / (1 - (1229.559 + 1972.925) / 6564.471)
=0.48109304 / 0.51214896
=0.9394

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
=11499.589 / 12637.441
=0.91

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))
=(249.328 / (249.328 + 1972.925)) / (231.696 / (231.696 + 1746.925))
=0.11219605 / 0.11709974
=0.9581

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)
=(431.389 / 11499.589) / (559.958 / 12637.441)
=0.03751343 / 0.04430945
=0.8466

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)
=((3216.505 + 966.846) / 6378.076) / ((3323.492 + 796.908) / 6564.471)
=0.65589545 / 0.62768196
=1.0449

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
=(-279.932 - 70.89 - -59.304) / 6378.076
=-0.0457

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.

NGL Energy Partners LP has a M-score of -2.26 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 local exchange's currency.

NGL Energy Partners LP Annual Data

Mar09Mar10Mar11Mar12Mar13Mar14Mar15Mar16
DSRI 1.39582.0680.68280.67450.7268
GMI 0.99570.8321.46731.16310.653
AQI 4.70461.0271.11551.04121.0194
SGI 1.61863.37112.19551.73230.6988
DEPI 1.67290.53870.9371.19380.8742
SGAI 0.95481.04160.68770.88321.5064
LVGI 0.90711.33121.0280.92041.126
TATA -0.1114-0.03510.0022-0.033-0.1395
M-score -0.480.21-1.36-2.11-3.97

NGL Energy Partners LP Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 0.89720.63260.67450.71840.53940.48560.72681.02611.11911.446
GMI 1.74791.53081.16310.88320.68640.5860.6530.73420.89651.2266
AQI 0.84740.95721.04121.04961.33441.18851.01941.00250.97910.9394
SGI 2.65322.39171.73231.39540.9210.71980.69880.65450.74310.91
DEPI 1.27531.1111.19381.27540.97131.04260.87420.96680.97360.9581
SGAI 0.5920.67210.87761.14921.43451.60011.50641.27581.08720.8466
LVGI 1.1361.04050.92041.0520.95490.93131.1261.01921.03931.0449
TATA -0.0035-0.0131-0.0331-0.0433-0.0682-0.0548-0.1402-0.072-0.0678-0.0457
M-score -0.73-1.32-2.11-2.64-3.39-3.68-3.97-3.30-3.01-2.26
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