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GuruFocus has detected 4 Warning Signs with Nutraceutical International Corp $NUTR.
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Nutraceutical International Corp (NAS:NUTR)
Beneish M-Score
-2.75 (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.

Nutraceutical International Corp has a M-score of -2.75 suggests that the company is not a manipulator.

NUTR' s Beneish M-Score Range Over the Past 10 Years
Min: -6.22   Max: -2.31
Current: -2.75

-6.22
-2.31

During the past 13 years, the highest Beneish M-Score of Nutraceutical International Corp was -2.31. The lowest was -6.22. And the median was -2.73.


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 Nutraceutical International 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 * 0.9191+0.528 * 0.9718+0.404 * 0.9298+0.892 * 1.065+0.115 * 0.9675
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.033+4.679 * -0.0512-0.327 * 0.885
=-2.75

* 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 $18.0 Mil.
Revenue was 56.619 + 56.701 + 60.836 + 59.492 = $233.6 Mil.
Gross Profit was 28.94 + 28.192 + 31.42 + 30.329 = $118.9 Mil.
Total Current Assets was $95.7 Mil.
Total Assets was $236.2 Mil.
Property, Plant and Equipment(Net PPE) was $82.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $14.3 Mil.
Selling, General & Admin. Expense(SGA) was $85.9 Mil.
Total Current Liabilities was $20.4 Mil.
Long-Term Debt was $39.5 Mil.
Net Income was 4.201 + 3.77 + 6.029 + 4.618 = $18.6 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.0 Mil.
Cash Flow from Operations was 4.872 + 9.318 + 6.155 + 10.362 = $30.7 Mil.
Accounts Receivable was $18.4 Mil.
Revenue was 55.959 + 53.649 + 54.382 + 55.404 = $219.4 Mil.
Gross Profit was 28.108 + 26.687 + 26.427 + 27.255 = $108.5 Mil.
Total Current Assets was $90.6 Mil.
Total Assets was $229.2 Mil.
Property, Plant and Equipment(Net PPE) was $77.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $13.0 Mil.
Selling, General & Admin. Expense(SGA) was $78.0 Mil.
Total Current Liabilities was $17.7 Mil.
Long-Term Debt was $48.0 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)
=(17.975 / 233.648) / (18.365 / 219.394)
=0.07693197 / 0.08370785
=0.9191

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)
=(108.477 / 219.394) / (118.881 / 233.648)
=0.49443923 / 0.50880384
=0.9718

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 - (95.748 + 82.314) / 236.205) / (1 - (90.627 + 77.908) / 229.216)
=0.24615482 / 0.26473283
=0.9298

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
=233.648 / 219.394
=1.065

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))
=(13.008 / (13.008 + 77.908)) / (14.286 / (14.286 + 82.314))
=0.14307713 / 0.1478882
=0.9675

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)
=(85.858 / 233.648) / (78.044 / 219.394)
=0.3674673 / 0.35572532
=1.033

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)
=((39.5 + 20.385) / 236.205) / ((48 + 17.663) / 229.216)
=0.25352977 / 0.28646779
=0.885

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
=(18.618 - 0 - 30.707) / 236.205
=-0.0512

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.

Nutraceutical International Corp has a M-score of -2.75 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.

Nutraceutical International Corp Annual Data

Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15Sep16
DSRI 1.04470.97170.99150.83361.22690.93310.9691.07251.10080.9779
GMI 0.97080.99731.03641.00691.02981.01461.01050.9961.01010.9685
AQI 1.32320.87890.62431.11930.94071.03890.94051.12740.95041.0927
SGI 1.04081.0660.97281.10911.04451.06541.04011.02921.00931.0763
DEPI 1.15031.08620.94430.99891.06210.96420.91530.90050.89540.9665
SGAI 1.07381.01490.95460.9520.99470.98260.97481.03150.99571.0216
LVGI 1.74771.06220.9361.06821.03160.97570.96011.06710.81281.1022
TATA -0.0737-0.0362-0.2957-0.0025-0.0619-0.0613-0.0508-0.0193-0.046-0.0599
M-score -2.87-2.68-4.01-2.51-2.53-2.74-2.72-2.47-2.56-2.73

Nutraceutical International Corp Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 1.07251.14781.09070.95381.10081.19911.10971.3580.97790.9191
GMI 0.9961.01491.01521.01521.01010.99360.98260.96660.96850.9718
AQI 1.12741.05931.04060.96240.95041.09211.09571.0751.09270.9298
SGI 1.02921.02741.03851.00931.00931.01591.03221.06811.07631.065
DEPI 0.90050.87530.84770.85410.89540.91751.0030.99850.96650.9675
SGAI 1.03151.03471.02161.01620.99570.98690.98960.99911.02161.033
LVGI 1.06710.99940.95240.81750.81281.0221.08091.15071.10220.885
TATA -0.0161-0.0082-0.026-0.0463-0.046-0.0559-0.0618-0.0383-0.0599-0.0512
M-score -2.45-2.35-2.47-2.70-2.56-2.52-2.63-2.31-2.73-2.75
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