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The Spectranetics Corp (NAS:SPNC)
Beneish M-Score
-1.81 (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.

The Spectranetics Corp has a M-score of -1.81 signals that the company is a manipulator.

SPNC' s 10-Year Beneish M-Score Range
Min: -3.93   Max: -0.04
Current: -1.81

-3.93
-0.04

During the past 13 years, the highest Beneish M-Score of The Spectranetics Corp was -0.04. The lowest was -3.93. And the median was -2.25.


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 The Spectranetics 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 * 1.1898+0.528 * 1.0006+0.404 * 5.7628+0.892 * 1.2903+0.115 * 0.8216
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0811+4.679 * -0.0433-0.327 * 5.4333
=-1.81

* 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 $41.1 Mil.
Revenue was 62.959 + 58.786 + 43.555 + 39.614 = $204.9 Mil.
Gross Profit was 46.04 + 43.086 + 33.049 + 29.28 = $151.5 Mil.
Total Current Assets was $172.3 Mil.
Total Assets was $467.0 Mil.
Property, Plant and Equipment(Net PPE) was $33.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $16.8 Mil.
Selling, General & Admin. Expense(SGA) was $128.0 Mil.
Total Current Liabilities was $41.3 Mil.
Long-Term Debt was $230.0 Mil.
Net Income was -14.731 + -13.944 + -6.565 + -5.661 = $-40.9 Mil.
Non Operating Income was -0.091 + -0.122 + -0.001 + 0.003 = $-0.2 Mil.
Cash Flow from Operations was -7.576 + -3.403 + -1.111 + -8.359 = $-20.4 Mil.
Accounts Receivable was $26.8 Mil.
Revenue was 41.92 + 39.763 + 39.453 + 37.675 = $158.8 Mil.
Gross Profit was 31.561 + 29.71 + 28.828 + 27.356 = $117.5 Mil.
Total Current Assets was $167.8 Mil.
Total Assets was $217.2 Mil.
Property, Plant and Equipment(Net PPE) was $28.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $10.6 Mil.
Selling, General & Admin. Expense(SGA) was $91.8 Mil.
Total Current Liabilities was $23.2 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)
=(41.09 / 204.914) / (26.766 / 158.811)
=0.20052315 / 0.16853996
=1.1898

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)
=(43.086 / 158.811) / (46.04 / 204.914)
=0.73958983 / 0.73911495
=1.0006

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 - (172.334 + 33.819) / 466.95) / (1 - (167.83 + 28.281) / 217.157)
=0.55851162 / 0.09691606
=5.7628

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
=204.914 / 158.811
=1.2903

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))
=(10.61 / (10.61 + 28.281)) / (16.813 / (16.813 + 33.819))
=0.27281376 / 0.33206273
=0.8216

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)
=(127.987 / 204.914) / (91.75 / 158.811)
=0.62458885 / 0.57773076
=1.0811

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)
=((230 + 41.343) / 466.95) / ((0 + 23.225) / 217.157)
=0.58109648 / 0.10695027
=5.4333

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
=(-40.901 - -0.211 - -20.449) / 466.95
=-0.0433

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.

The Spectranetics Corp has a M-score of -1.81 signals that the company is likely to 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.

The Spectranetics Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.01280.93510.98880.85850.95070.93431.07180.99861.18541.1898
GMI 0.98671.03210.99711.02461.008510.98890.98590.98661.0006
AQI 0.49161.26610.73123.22480.84990.30141.80911.10160.77035.7628
SGI 1.2451.46931.30531.2551.10411.02681.07951.10211.13211.2903
DEPI 1.57011.07340.97540.85160.77840.92580.96330.99930.9820.8216
SGAI 1.00261.12240.96281.01251.08770.85010.97971.05860.98531.0823
LVGI 1.04050.4841.02560.98991.02791.31821.29180.71090.58675.4333
TATA 0.02780.05750.0696-0.0262-0.0626-0.2237-0.0535-0.0265-0.0212-0.0433
M-score -2.28-1.57-2.01-1.61-2.83-3.93-2.37-2.40-2.26-1.81

The Spectranetics Corp Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.05840.99861.12081.07451.05981.18541.10561.46881.26361.1898
GMI 0.9790.98590.99541.00040.99230.98660.9810.97250.98581.0006
AQI 2.16071.10161.63570.89870.90780.77030.42864.57894.62835.7628
SGI 1.09661.10211.11191.12151.12921.13211.1111.10561.19681.2903
DEPI 0.98040.99930.95440.94770.94890.9821.02421.08170.95650.8216
SGAI 1.19291.05861.02991.01620.99720.98531.0321.10171.15651.0811
LVGI 0.84130.71090.84480.56420.54220.58670.64725.99946.33345.4333
TATA -0.0072-0.0265-0.0188-0.025-0.0257-0.0212-0.0346-0.021-0.0369-0.0433
M-score -1.90-2.40-2.06-2.33-2.33-2.26-2.57-2.26-2.55-1.81
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