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Sturm Ruger & Co Inc (NYSE:RGR)
Beneish M-Score
-2.82 (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.

Sturm Ruger & Co Inc has a M-score of -2.82 suggests that the company is not a manipulator.

RGR' s 10-Year Beneish M-Score Range
Min: -3.76   Max: -1.78
Current: -2.82

-3.76
-1.78

During the past 13 years, the highest Beneish M-Score of Sturm Ruger & Co Inc was -1.78. The lowest was -3.76. 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 Sturm Ruger & Co 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 * 0.933+0.528 * 1.2093+0.404 * 1.5073+0.892 * 0.7911+0.115 * 0.6734
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.7203+4.679 * -0.0707-0.327 * 0.7461
=-2.82

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $49.7 Mil.
Revenue was 122.605 + 98.327 + 153.657 + 169.884 = $544.5 Mil.
Gross Profit was 33.96 + 23.738 + 50.353 + 61.123 = $169.2 Mil.
Total Current Assets was $118.2 Mil.
Total Assets was $254.4 Mil.
Property, Plant and Equipment(Net PPE) was $110.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $36.7 Mil.
Selling, General & Admin. Expense(SGA) was $114.4 Mil.
Total Current Liabilities was $60.4 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was -14.759 + 6.781 + 22.286 + 24.319 = $38.6 Mil.
Non Operating Income was -0.116 + 0.673 + 0.13 + 0.365 = $1.1 Mil.
Cash Flow from Operations was 24.597 + -4.622 + 19.866 + 15.71 = $55.6 Mil.
Accounts Receivable was $67.4 Mil.
Revenue was 181.9 + 170.942 + 179.528 + 155.905 = $688.3 Mil.
Gross Profit was 63.632 + 62.94 + 70.724 + 61.309 = $258.6 Mil.
Total Current Assets was $157.6 Mil.
Total Assets was $277.1 Mil.
Property, Plant and Equipment(Net PPE) was $101.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $20.4 Mil.
Selling, General & Admin. Expense(SGA) was $84.1 Mil.
Total Current Liabilities was $88.2 Mil.
Long-Term Debt was $0.0 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)
=(49.735 / 544.473) / (67.384 / 688.275)
=0.09134521 / 0.09790273
=0.933

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)
=(23.738 / 688.275) / (33.96 / 544.473)
=0.37572918 / 0.31071146
=1.2093

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 - (118.174 + 110.661) / 254.382) / (1 - (157.626 + 101.028) / 277.118)
=0.1004277 / 0.06662866
=1.5073

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
=544.473 / 688.275
=0.7911

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))
=(20.362 / (20.362 + 101.028)) / (36.706 / (36.706 + 110.661))
=0.16774034 / 0.24907883
=0.6734

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)
=(114.449 / 544.473) / (84.099 / 688.275)
=0.21020142 / 0.12218808
=1.7203

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)
=((0 + 60.382) / 254.382) / ((0 + 88.166) / 277.118)
=0.23736742 / 0.31815328
=0.7461

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
=(38.627 - 1.052 - 55.551) / 254.382
=-0.0707

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.

Sturm Ruger & Co Inc has a M-score of -2.82 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.

Sturm Ruger & Co Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.92331.05350.93011.42330.651.3381.03820.68111.11930.933
GMI 1.20431.17910.57581.06610.72870.98240.96820.93410.96841.2093
AQI 1.56511.02570.58681.81850.66210.81970.58161.87081.00461.5073
SGI 1.06251.08340.93361.15971.49320.94181.28841.49571.39940.7911
DEPI 0.92381.31450.86910.97310.93151.03240.94641.01381.09740.6734
SGAI 1.00980.90361.28280.90080.94661.00410.95950.910.88911.7203
LVGI 1.00951.37661.09421.31720.89070.90641.13651.41970.93310.7461
TATA -0.0285-0.2626-0.1391-0.0232-0.1389-0.0322-0.0899-0.1012-0.032-0.0707
M-score -2.31-3.55-3.74-1.78-3.25-2.42-2.84-2.61-2.13-2.82

Sturm Ruger & Co Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 0.96040.68110.82880.82550.91961.11930.89590.79360.77090.933
GMI 0.9460.93410.95570.95780.9550.96841.00741.06931.14511.2093
AQI 0.72011.87081.77121.18881.58791.00461.36141.58021.47761.5073
SGI 1.47911.49571.4641.46761.46211.39941.31171.13610.93150.7911
DEPI 1.10011.01381.0320.97050.94961.09740.95640.88010.76630.6734
SGAI 0.91820.910.91590.86920.85750.88910.85070.90831.0181.7203
LVGI 1.04211.41971.62071.66491.46320.93310.78250.66450.57680.7461
TATA -0.0662-0.1012-0.0855-0.1158-0.0231-0.03220.02170.05590.0461-0.0707
M-score -2.53-2.61-2.52-2.91-2.17-2.13-1.95-1.90-2.16-2.82
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