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Stoneridge Inc (NYSE:SRI)
Beneish M-Score
-2.85 (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.

Stoneridge Inc has a M-score of -2.85 suggests that the company is not a manipulator.

SRI' s 10-Year Beneish M-Score Range
Min: -5.18   Max: -1.7
Current: -2.85

-5.18
-1.7

During the past 13 years, the highest Beneish M-Score of Stoneridge Inc was -1.70. The lowest was -5.18. And the median was -2.67.


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 Stoneridge 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 * 0.5707+0.528 * 1.2648+0.404 * 0.8536+0.892 * 1.2995+0.115 * 0.9703
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8614+4.679 * -0.0734-0.327 * 1.0012
=-2.85

* 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 $112.0 Mil.
Revenue was 170.338 + 162.099 + 236.389 + 457.579 = $1,026.4 Mil.
Gross Profit was 49.55 + 48.285 + 54.789 + 70.709 = $223.3 Mil.
Total Current Assets was $321.8 Mil.
Total Assets was $511.7 Mil.
Property, Plant and Equipment(Net PPE) was $85.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $26.1 Mil.
Selling, General & Admin. Expense(SGA) was $194.9 Mil.
Total Current Liabilities was $186.8 Mil.
Long-Term Debt was $109.4 Mil.
Net Income was -0.13 + -21.892 + 1.468 + 0.204 = $-20.4 Mil.
Non Operating Income was -0.738 + -0.186 + -1.708 + -0.528 = $-3.2 Mil.
Cash Flow from Operations was 6.213 + 9.132 + -16.191 + 21.24 = $20.4 Mil.
Accounts Receivable was $151.0 Mil.
Revenue was 161.556 + 169.833 + 235.71 + 222.725 = $789.8 Mil.
Gross Profit was 49.729 + 54.303 + 58.729 + 54.609 = $217.4 Mil.
Total Current Assets was $345.7 Mil.
Total Assets was $603.6 Mil.
Property, Plant and Equipment(Net PPE) was $113.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $33.4 Mil.
Selling, General & Admin. Expense(SGA) was $174.1 Mil.
Total Current Liabilities was $161.4 Mil.
Long-Term Debt was $187.5 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)
=(111.984 / 1026.405) / (150.988 / 789.824)
=0.10910313 / 0.19116664
=0.5707

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)
=(48.285 / 789.824) / (49.55 / 1026.405)
=0.27521321 / 0.2175876
=1.2648

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 - (321.842 + 85.02) / 511.736) / (1 - (345.73 + 112.953) / 603.604)
=0.2049377 / 0.24009284
=0.8536

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
=1026.405 / 789.824
=1.2995

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))
=(33.355 / (33.355 + 112.953)) / (26.111 / (26.111 + 85.02))
=0.22797796 / 0.23495694
=0.9703

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)
=(194.87 / 1026.405) / (174.076 / 789.824)
=0.18985683 / 0.22039847
=0.8614

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)
=((109.352 + 186.78) / 511.736) / ((187.452 + 161.434) / 603.604)
=0.57868119 / 0.57800478
=1.0012

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
=(-20.35 - -3.16 - 20.394) / 511.736
=-0.0734

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.

Stoneridge Inc has a M-score of -2.85 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.

Stoneridge Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.00411.01271.01021.11410.76261.33370.94431.31330.71080.9358
GMI 1.00661.15480.98670.97211.04411.19310.80811.19490.80121.0038
AQI 0.54621.070.9390.95420.41451.43351.04261.65961.05290.8507
SGI 1.12380.9851.05531.0261.03520.63131.33691.20491.22621.0099
DEPI 0.93340.97671.00370.79691.01871.16391.02911.52120.67870.9318
SGAI 1.05981.05260.97861.04640.98251.23740.85930.87261.24520.9417
LVGI 1.22620.99260.9720.94621.20841.03410.97620.86780.88951.0194
TATA 0.0884-0.0501-0.079-0.0545-0.3319-0.1457-0.0328-0.0387-0.1114-0.0475
M-score -2.22-2.62-2.81-2.65-4.50-2.94-2.43-1.70-3.19-2.81

Stoneridge Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 1.020.96630.71080.79611.02381.1260.86560.84320.54110.5707
GMI 0.98790.9050.80120.86430.83120.81531.05051.0691.17581.2648
AQI 1.59991.77831.05290.96490.93230.88170.85070.88030.76280.8536
SGI 1.24721.21911.22621.09270.96480.87581.09181.12431.20071.2995
DEPI 1.19311.08780.67870.69070.7220.77480.93181.01270.95120.9703
SGAI 1.10481.22961.24521.17351.10221.07490.89740.88790.87340.8614
LVGI 0.84640.75890.88950.9810.96951.00691.01941.01011.03381.0012
TATA -0.1096-0.1448-0.1203-0.1052-0.0809-0.0644-0.0471-0.022-0.0793-0.0734
M-score -2.46-2.68-3.23-3.22-3.02-2.96-2.77-2.61-3.09-2.85
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