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Enpro Industries Inc (NYSE:NPO)
Beneish M-Score
-2.44 (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.

Enpro Industries Inc has a M-score of -2.44 suggests that the company is not a manipulator.

NPO' s 10-Year Beneish M-Score Range
Min: -3.59   Max: -2.09
Current: -2.44

-3.59
-2.09

During the past 13 years, the highest Beneish M-Score of Enpro Industries Inc was -2.09. The lowest was -3.59. And the median was -2.61.


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 Enpro 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 * 1.1409+0.528 * 1.0177+0.404 * 0.9181+0.892 * 0.9898+0.115 * 1.0049
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0635+4.679 * -0.016-0.327 * 0.9044
=-2.44

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $235 Mil.
Revenue was 313.1 + 287.2 + 275.5 + 276 = $1,152 Mil.
Gross Profit was 108.1 + 96.5 + 85.8 + 92.1 = $383 Mil.
Total Current Assets was $524 Mil.
Total Assets was $1,466 Mil.
Property, Plant and Equipment(Net PPE) was $186 Mil.
Depreciation, Depletion and Amortization(DDA) was $57 Mil.
Selling, General & Admin. Expense(SGA) was $300 Mil.
Total Current Liabilities was $334 Mil.
Long-Term Debt was $309 Mil.
Net Income was 8.3 + 1.3 + 5.2 + 5.6 = $20 Mil.
Non Operating Income was -2.5 + -4.2 + 0 + 0 = $-7 Mil.
Cash Flow from Operations was 11.2 + -25 + 31.8 + 32.6 = $51 Mil.
Accounts Receivable was $208 Mil.
Revenue was 305.8 + 286.9 + 279.3 + 291.7 = $1,164 Mil.
Gross Profit was 109.2 + 94.2 + 91.1 + 98.8 = $393 Mil.
Total Current Assets was $428 Mil.
Total Assets was $1,401 Mil.
Property, Plant and Equipment(Net PPE) was $186 Mil.
Depreciation, Depletion and Amortization(DDA) was $58 Mil.
Selling, General & Admin. Expense(SGA) was $285 Mil.
Total Current Liabilities was $382 Mil.
Long-Term Debt was $297 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)
=(235.1 / 1151.8) / (208.2 / 1163.7)
=0.2041153 / 0.17891209
=1.1409

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)
=(96.5 / 1163.7) / (108.1 / 1151.8)
=0.3379737 / 0.3320889
=1.0177

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 - (523.9 + 185.6) / 1466.2) / (1 - (427.7 + 185.7) / 1400.8)
=0.51609603 / 0.56210737
=0.9181

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
=1151.8 / 1163.7
=0.9898

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))
=(57.5 / (57.5 + 185.7)) / (57.1 / (57.1 + 185.6))
=0.23643092 / 0.23526988
=1.0049

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)
=(300 / 1151.8) / (285 / 1163.7)
=0.26046189 / 0.24490848
=1.0635

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)
=((308.8 + 333.6) / 1466.2) / ((296.7 + 381.9) / 1400.8)
=0.43813941 / 0.48443746
=0.9044

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
=(20.4 - -6.7 - 50.6) / 1466.2
=-0.016

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.

Enpro Industries Inc has a M-score of -2.44 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.

Enpro Industries Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.95480.86571.02180.87591.10880.73331.07540.89481.0676
GMI 0.94530.98320.9470.96921.03720.92831.09261.01471.0139
AQI 1.07920.97840.97711.01250.88420.96851.21751.02470.9425
SGI 1.01491.10711.10940.96490.8081.07721.2781.07120.9662
DEPI 1.01351.0011.01550.96860.99460.81070.96740.98860.9932
SGAI 0.92590.96471.36281.02561.51610.68680.80830.97121.0339
LVGI 1.02450.94891.03050.92821.05591.60291.01510.98681.0221
TATA -0.02190.089-0.0443-0.0316-0.19150.0574-0.0298-0.0554-0.026
M-score -2.60-2.09-2.68-2.77-3.58-2.60-2.14-2.75-2.60

Enpro Industries Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.87110.91780.93050.89480.96630.94720.97021.06761.06921.1409
GMI 1.06321.09761.03941.01471.02390.98821.00451.01390.9961.0177
AQI 0.99361.03530.98561.02471.04661.01421.00590.94250.93460.9181
SGI 1.26591.28951.14691.07121.01060.98170.97590.96620.9870.9898
DEPI 0.86540.89190.91880.98860.99890.97630.99630.99321.00251.0049
SGAI 0.8990.89240.96810.97120.9860.99831.00651.03391.03771.0635
LVGI 1.01181.09491.01410.98681.03180.95360.97341.02210.94470.9044
TATA -0.0425-0.0237-0.0433-0.0554-0.0437-0.0559-0.0489-0.026-0.0225-0.016
M-score -2.53-2.37-2.61-2.75-2.68-2.79-2.75-2.60-2.55-2.44
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