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ON Semiconductor Corp (NAS:ONNN)
Beneish M-Score
-2.51 (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.

ON Semiconductor Corp has a M-score of -2.51 suggests that the company is not a manipulator.

ONNN' s 10-Year Beneish M-Score Range
Min: -4.44   Max: -0.99
Current: -2.51

-4.44
-0.99

During the past 13 years, the highest Beneish M-Score of ON Semiconductor Corp was -0.99. The lowest was -4.44. And the median was -2.70.


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 ON Semiconductor 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 * 1.0611+0.528 * 0.9278+0.404 * 1.4061+0.892 * 1.0986+0.115 * 1.0034
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0113+4.679 * -0.0582-0.327 * 1.0849
=-2.51

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $489 Mil.
Revenue was 833.5 + 757.6 + 706.5 + 718 = $3,016 Mil.
Gross Profit was 284.1 + 273 + 250.8 + 252.9 = $1,061 Mil.
Total Current Assets was $1,813 Mil.
Total Assets was $3,882 Mil.
Property, Plant and Equipment(Net PPE) was $1,212 Mil.
Depreciation, Depletion and Amortization(DDA) was $240 Mil.
Selling, General & Admin. Expense(SGA) was $359 Mil.
Total Current Liabilities was $1,013 Mil.
Long-Term Debt was $980 Mil.
Net Income was 41.6 + 88 + 58.4 + 28.7 = $217 Mil.
Non Operating Income was -0.9 + -1.2 + -0.6 + -0.5 = $-3 Mil.
Cash Flow from Operations was 92.3 + 151.6 + 74.9 + 127 = $446 Mil.
Accounts Receivable was $419 Mil.
Revenue was 715.4 + 688.3 + 661 + 680.2 = $2,745 Mil.
Gross Profit was 249.2 + 231.8 + 204.5 + 210.4 = $896 Mil.
Total Current Assets was $1,646 Mil.
Total Assets was $3,249 Mil.
Property, Plant and Equipment(Net PPE) was $1,093 Mil.
Depreciation, Depletion and Amortization(DDA) was $217 Mil.
Selling, General & Admin. Expense(SGA) was $323 Mil.
Total Current Liabilities was $878 Mil.
Long-Term Debt was $659 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)
=(488.7 / 3015.6) / (419.2 / 2744.9)
=0.1620573 / 0.15271959
=1.0611

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)
=(273 / 2744.9) / (284.1 / 3015.6)
=0.32638712 / 0.35177079
=0.9278

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 - (1813.2 + 1211.9) / 3882.2) / (1 - (1645.7 + 1092.9) / 3248.7)
=0.22077688 / 0.15701665
=1.4061

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
=3015.6 / 2744.9
=1.0986

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))
=(217.4 / (217.4 + 1092.9)) / (240.1 / (240.1 + 1211.9))
=0.1659162 / 0.16535813
=1.0034

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)
=(359.1 / 3015.6) / (323.2 / 2744.9)
=0.11908078 / 0.11774564
=1.0113

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)
=((980.3 + 1013) / 3882.2) / ((659.4 + 878.1) / 3248.7)
=0.51344598 / 0.47326623
=1.0849

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
=(216.7 - -3.2 - 445.8) / 3882.2
=-0.0582

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.

ON Semiconductor Corp has a M-score of -2.51 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.

ON Semiconductor Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.81531.22430.91390.96320.86581.5230.86341.0430.93061.1148
GMI 0.87020.97460.86341.01990.99091.08430.84911.41010.89120.9751
AQI 0.75771.04881.0171.74381.34660.98091.06690.69710.95990.9083
SGI 1.1850.9951.21511.02251.3120.86091.30781.4880.8410.9612
DEPI 1.14131.00751.4690.96950.84240.86141.11650.94460.94731.0981
SGAI 0.96331.05940.95020.97581.1041.01960.93460.94531.04790.9739
LVGI 0.95160.92310.92130.84770.64760.91020.8991.08480.92940.9595
TATA 0.0016-0.0779-0.0543-0.0457-0.3491-0.0862-0.0869-0.1355-0.1095-0.0542
M-score -2.61-2.62-2.60-2.35-3.74-2.48-2.73-2.57-3.26-2.68

ON Semiconductor Corp Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.71570.84070.93061.01831.06141.09651.11481.12921.02011.0611
GMI 1.05530.94150.89120.94130.99071.00740.97510.93090.9070.9278
AQI 0.96350.95180.95990.97140.98060.95510.90830.88350.94271.4061
SGI 1.06720.91670.8410.84780.87320.92030.96121.00591.05171.0986
DEPI 0.87430.94790.94730.96910.98181.00111.09811.07031.0591.0034
SGAI 1.01051.01281.04791.02781.02691.02180.97390.99170.98791.0113
LVGI 0.94060.92060.92940.92410.92770.93570.95950.97730.97361.0849
TATA -0.1095-0.0656-0.1095-0.1176-0.104-0.1096-0.0542-0.0402-0.0535-0.0582
M-score -3.18-3.04-3.26-3.18-3.02-2.97-2.68-2.61-2.72-2.51
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