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GuruFocus has detected 6 Warning Signs with Portland General Electric Co $POR.
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Portland General Electric Co (NYSE:POR)
Beneish M-Score
-2.77 (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.

Portland General Electric Co has a M-score of -2.77 suggests that the company is not a manipulator.

POR' s Beneish M-Score Range Over the Past 10 Years
Min: -3.48   Max: -1.14
Current: -2.77

-3.48
-1.14

During the past 13 years, the highest Beneish M-Score of Portland General Electric Co was -1.14. The lowest was -3.48. And the median was -2.74.


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 Portland General Electric Co 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 * 0.9683+0.528 * 0.9645+0.404 * 0.9414+0.892 * 1.0132+0.115 * 1.016
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0116+4.679 * -0.0508-0.327 * 0.9903
=-2.77

* 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 $155 Mil.
Revenue was 524 + 484 + 428 + 487 = $1,923 Mil.
Gross Profit was 275 + 235 + 238 + 272 = $1,020 Mil.
Total Current Assets was $463 Mil.
Total Assets was $7,527 Mil.
Property, Plant and Equipment(Net PPE) was $6,434 Mil.
Depreciation, Depletion and Amortization(DDA) was $321 Mil.
Selling, General & Admin. Expense(SGA) was $247 Mil.
Total Current Liabilities was $577 Mil.
Long-Term Debt was $2,200 Mil.
Net Income was 61 + 34 + 37 + 61 = $193 Mil.
Non Operating Income was 3 + 4 + 9 + 6 = $22 Mil.
Cash Flow from Operations was 56 + 159 + 177 + 161 = $553 Mil.
Accounts Receivable was $158 Mil.
Revenue was 499 + 476 + 450 + 473 = $1,898 Mil.
Gross Profit was 254 + 231 + 236 + 250 = $971 Mil.
Total Current Assets was $557 Mil.
Total Assets was $7,210 Mil.
Property, Plant and Equipment(Net PPE) was $6,012 Mil.
Depreciation, Depletion and Amortization(DDA) was $305 Mil.
Selling, General & Admin. Expense(SGA) was $241 Mil.
Total Current Liabilities was $626 Mil.
Long-Term Debt was $2,060 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)
=(155 / 1923) / (158 / 1898)
=0.08060322 / 0.08324552
=0.9683

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)
=(971 / 1898) / (1020 / 1923)
=0.51159115 / 0.53042122
=0.9645

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 - (463 + 6434) / 7527) / (1 - (557 + 6012) / 7210)
=0.08369868 / 0.0889043
=0.9414

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
=1923 / 1898
=1.0132

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))
=(305 / (305 + 6012)) / (321 / (321 + 6434))
=0.04828241 / 0.04752036
=1.016

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)
=(247 / 1923) / (241 / 1898)
=0.12844514 / 0.12697576
=1.0116

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)
=((2200 + 577) / 7527) / ((2060 + 626) / 7210)
=0.36893849 / 0.37253814
=0.9903

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
=(193 - 22 - 553) / 7527
=-0.0508

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.

Portland General Electric Co has a M-score of -2.77 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.

Portland General Electric Co Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.8770.94270.91550.87181.03371.06020.95790.97221.06150.9683
GMI 1.00471.23921.05810.86420.93090.97721.05120.93460.95680.9645
AQI 0.88541.28040.7681.05211.00590.90610.89250.91310.94290.9414
SGI 1.14671.00111.03380.98841.01680.99561.00281.04970.99891.0132
DEPI 1.33770.94041.14310.95241.08230.94131.10520.96081.04251.016
SGAI 0.97841.03140.91131.05131.15260.99521.25120.7981.06281.0116
LVGI 1.04241.01231.00280.9890.94190.92481.04321.12530.87480.9903
TATA -0.0543-0.0186-0.0603-0.0515-0.0544-0.064-0.0752-0.0544-0.0513-0.0508
M-score -2.73-2.40-2.84-2.91-2.72-2.76-2.93-2.80-2.68-2.77

Portland General Electric Co Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 1.06370.97220.79470.97810.85261.06150.99091.02551.05320.9683
GMI 0.95460.93460.94740.96220.95710.95680.94740.94330.95650.9645
AQI 0.74560.91311.02231.07251.1060.94290.87010.92680.9180.9414
SGI 1.07051.04971.02731.030810.99891.0170.99110.99951.0132
DEPI 1.02390.96081.0020.98781.00281.04251.02531.01851.01051.016
SGAI 0.79020.7980.83691.04511.07561.06281.02121.03451.02121.0116
LVGI 1.12961.12531.11460.95410.90330.87480.88810.98561.0030.9903
TATA -0.062-0.0544-0.0518-0.0463-0.0484-0.0513-0.0527-0.0606-0.0565-0.0508
M-score -2.78-2.80-2.91-2.67-2.80-2.68-2.76-2.81-2.76-2.77
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