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Stoneridge, Inc. (NYSE:SRI)
Beneish M-Score
-2.81 (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.

Stoneridge, Inc. has a M-score of -2.81 suggests that the company is not a manipulator.

SRI' s 10-Year Beneish M-Score Range
Min: -4.5   Max: -1.7
Current: -2.81

-4.5
-1.7

During the past 13 years, the highest Beneish M-Score of Stoneridge, Inc. was -1.70. The lowest was -4.50. And the median was -2.81.


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 * 0.9358+0.528 * 1.0038+0.404 * 0.8507+0.892 * 1.0099+0.115 * 0.9318
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9417+4.679 * -0.0466-0.327 * 1.0194
=-2.81

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $133.7 Mil.
Revenue was 235.824 + 233.511 + 242.785 + 235.71 = $947.8 Mil.
Gross Profit was 53.553 + 53.519 + 60.22 + 58.729 = $226.0 Mil.
Total Current Assets was $340.2 Mil.
Total Assets was $588.3 Mil.
Property, Plant and Equipment(Net PPE) was $110.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $29.0 Mil.
Selling, General & Admin. Expense(SGA) was $186.3 Mil.
Total Current Liabilities was $153.7 Mil.
Long-Term Debt was $185.0 Mil.
Net Income was 0.204 + 5.047 + 5.757 + 4.123 = $15.1 Mil.
Non Operating Income was -0.842 + 0.368 + -0.266 + -0.416 = $-1.2 Mil.
Cash Flow from Operations was 21.24 + 19.201 + 3.837 + -0.594 = $43.7 Mil.
Accounts Receivable was $141.5 Mil.
Revenue was 222.725 + 219.256 + 234.265 + 262.267 = $938.5 Mil.
Gross Profit was 54.609 + 51.238 + 53.659 + 65.138 = $224.6 Mil.
Total Current Assets was $311.1 Mil.
Total Assets was $592.7 Mil.
Property, Plant and Equipment(Net PPE) was $119.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $28.5 Mil.
Selling, General & Admin. Expense(SGA) was $195.9 Mil.
Total Current Liabilities was $153.5 Mil.
Long-Term Debt was $181.3 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)
=(133.736 / 947.83) / (141.503 / 938.513)
=0.14109703 / 0.15077362
=0.9358

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)
=(53.519 / 938.513) / (53.553 / 947.83)
=0.23936163 / 0.23846154
=1.0038

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 - (340.236 + 110.872) / 588.322) / (1 - (311.054 + 119.147) / 592.691)
=0.23322942 / 0.27415635
=0.8507

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
=947.83 / 938.513
=1.0099

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))
=(28.519 / (28.519 + 119.147)) / (28.989 / (28.989 + 110.872))
=0.1931318 / 0.20727008
=0.9318

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)
=(186.317 / 947.83) / (195.915 / 938.513)
=0.19657217 / 0.20875044
=0.9417

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)
=((185.045 + 153.722) / 588.322) / ((181.311 + 153.469) / 592.691)
=0.57581902 / 0.56484745
=1.0194

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
=(15.131 - -1.156 - 43.684) / 588.322
=-0.0466

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 -2.81 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

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 0.97391.31331.14551.020.96630.71080.79610.94270.95150.9358
GMI 1.11531.19491.07270.98790.9050.80120.86430.8790.92361.0038
AQI 0.97191.65961.76511.59991.77831.05290.96490.93230.88170.8507
SGI 1.21561.20491.2271.24721.21911.22621.09271.04781.03651.0099
DEPI 1.03611.52121.40981.19311.08780.67870.72420.78870.87440.9318
SGAI 0.86080.87260.97111.10481.22961.24521.17351.04750.96840.9417
LVGI 1.00160.86780.80460.84640.75890.88950.9810.96951.00691.0194
TATA 0.0337-0.0387-0.0648-0.1096-0.1448-0.1203-0.1052-0.0806-0.0644-0.0466
M-score -2.08-1.70-1.98-2.46-2.68-3.23-3.22-2.98-2.89-2.81
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