Watts Water Technologies Beneish M-Score Historical Data
The historical data trend for Watts Water Technologies's Beneish M-Score can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Watts Water Technologies Beneish M-Score Chart
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Watts Water Technologies Annual Data
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Trend |
Dec14 |
Dec15 |
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Dec17 |
Dec18 |
Dec19 |
Dec20 |
Dec21 |
Dec22 |
Dec23 |
| Beneish M-Score |
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-2.53 |
-2.76 |
-2.41 |
-2.34 |
-2.50 |
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Watts Water Technologies Quarterly Data
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Mar19 |
Jun19 |
Sep19 |
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Dec20 |
Mar21 |
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Jun23 |
Sep23 |
Dec23 |
| Beneish M-Score |
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-2.34 |
-2.42 |
-2.43 |
-2.58 |
-2.50 |
Competitive Comparison of Watts Water Technologies's Beneish M-Score
For the Specialty Industrial Machinery subindustry, Watts Water Technologies's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Watts Water Technologies's Beneish M-Score Distribution in the Industrial Products Industry
For the Industrial Products industry and Industrials sector, Watts Water Technologies's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where Watts Water Technologies's Beneish M-Score falls into.
Watts Water Technologies Beneish M-Score Calculation
The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Watts Water Technologies 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 * 1.0697 | + | 0.528 * 0.9452 | + | 0.404 * 1.0674 | + | 0.892 * 1.0388 | + | 0.115 * 1.1301 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 1.0571 | + | 4.679 * -0.018533 | - | 0.327 * 1.1186 |
| = | -2.50 |
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
| This Year (Dec23) TTM: | Last Year (Dec22) TTM: |
Total Receivables was $260 Mil.
Revenue was 547.5 + 504.3 + 532.8 + 471.7 = $2,056 Mil.
Gross Profit was 255.6 + 234.4 + 252.8 + 218.1 = $961 Mil.
Total Current Assets was $1,061 Mil.
Total Assets was $2,309 Mil.
Property, Plant and Equipment(Net PPE) was $248 Mil.
Depreciation, Depletion and Amortization(DDA) was $43 Mil.
Selling, General, & Admin. Expense(SGA) was $605 Mil.
Total Current Liabilities was $406 Mil.
Long-Term Debt & Capital Lease Obligation was $298 Mil.
Net Income was 55.7 + 65.8 + 75.9 + 64.7 = $262 Mil.
Non Operating Income was -4.6 + -0.5 + -1 + 0.2 = $-6 Mil.
Cash Flow from Operations was 109.9 + 100.4 + 67.1 + 33.4 = $311 Mil.
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Total Receivables was $234 Mil.
Revenue was 501.9 + 487.8 + 526.6 + 463.2 = $1,980 Mil.
Gross Profit was 218.6 + 217.9 + 239.2 + 198.6 = $874 Mil.
Total Current Assets was $951 Mil.
Total Assets was $1,931 Mil.
Property, Plant and Equipment(Net PPE) was $197 Mil.
Depreciation, Depletion and Amortization(DDA) was $40 Mil.
Selling, General, & Admin. Expense(SGA) was $551 Mil.
Total Current Liabilities was $379 Mil.
Long-Term Debt & Capital Lease Obligation was $148 Mil.
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1. DSRI = Days Sales in Receivables Index
Measured as the ratio of Revenue in Total 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) |
| = | (259.8 / 2056.3) | / | (233.8 / 1979.5) |
| = | 0.126343 | / | 0.118111 |
| | = | 1.0697 |
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) |
| = | (874.3 / 1979.5) | / | (960.9 / 2056.3) |
| = | 0.441677 | / | 0.467296 |
| | = | 0.9452 |
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 Property, Plant and Equipment to Total Assets.
| AQI | = | (1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) | / | (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1) |
| = | (1 - (1061 + 248.2) / 2309.4) | / | (1 - (950.6 + 196.8) / 1930.9) |
| = | 0.4331 | / | 0.405769 |
| | = | 1.0674 |
4. SGI = Sales Growth Index
Ratio of Revenue 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 |
| = | 2056.3 | / | 1979.5 |
| | = | 1.0388 |
5. DEPI = Depreciation Index
Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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)) |
| = | (39.7 / (39.7 + 196.8)) | / | (43.3 / (43.3 + 248.2)) |
| = | 0.167865 | / | 0.148542 |
| | = | 1.1301 |
Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.
6. SGAI = Sales, General and Administrative expenses Index
The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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) |
| = | (604.5 / 2056.3) | / | (550.5 / 1979.5) |
| = | 0.293975 | / | 0.278101 |
| | = | 1.0571 |
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 in leverage
| LVGI | = | ((LTD_t + CurrentLiabilities_t) / TotalAssets_t) | / | ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1) |
| = | ((298.3 + 405.8) / 2309.4) | / | ((147.6 + 378.7) / 1930.9) |
| = | 0.304884 | / | 0.272567 |
| | = | 1.1186 |
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 |
| = | (262.1 - -5.9 | - | 310.8) | / | 2309.4 |
| | = | -0.018533 |
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
Watts Water Technologies has a M-score of -2.50 suggests that the company is unlikely to be a manipulator.
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