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Stantec Inc (NYSE:STN)
Beneish M-Score
-2.62 (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.

Stantec Inc has a M-score of -2.68 suggests that the company is not a manipulator.

STN' s 10-Year Beneish M-Score Range
Min: -3.04   Max: -0.07
Current: -2.62

-3.04
-0.07

During the past 13 years, the highest Beneish M-Score of Stantec Inc was -0.07. The lowest was -3.04. And the median was -2.44.


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 Stantec 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 * 1.0507+0.528 * 0.9065+0.404 * 1.0507+0.892 * 0.9693+0.115 * 1.0319
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1178+4.679 * -0.0394-0.327 * 0.9746
=-2.68

* 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 $382 Mil.
Revenue was 612.737262737 + 585.243767313 + 516.555355536 + 540.707706767 = $2,255 Mil.
Gross Profit was 270.430478612 + 267.79501385 + 235.493249325 + 239.315789474 = $1,013 Mil.
Total Current Assets was $738 Mil.
Total Assets was $1,767 Mil.
Property, Plant and Equipment(Net PPE) was $139 Mil.
Depreciation, Depletion and Amortization(DDA) was $54 Mil.
Selling, General & Admin. Expense(SGA) was $755 Mil.
Total Current Liabilities was $437 Mil.
Long-Term Debt was $217 Mil.
Net Income was 44.1313232222 + 40.9095106187 + 30.1827182718 + 33.5159774436 = $149 Mil.
Non Operating Income was -1.24602670057 + 0.0240073868883 + 0.220522052205 + 4.30921052632 = $3 Mil.
Cash Flow from Operations was 87.6232858051 + 17.2132963989 + -3.26282628263 + 113.510338346 = $215 Mil.
Accounts Receivable was $375 Mil.
Revenue was 562.056092843 + 549.683802134 + 501.178710938 + 713.698989899 = $2,327 Mil.
Gross Profit was 254.343326886 + 246.850630456 + 224.928710938 + 221.214141414 = $947 Mil.
Total Current Assets was $689 Mil.
Total Assets was $1,573 Mil.
Property, Plant and Equipment(Net PPE) was $130 Mil.
Depreciation, Depletion and Amortization(DDA) was $52 Mil.
Selling, General & Admin. Expense(SGA) was $697 Mil.
Total Current Liabilities was $395 Mil.
Long-Term Debt was $203 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)
=(381.516665153 / 2255.24409235) / (374.588007737 / 2326.61759581)
=0.16916868 / 0.16100111
=1.0507

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)
=(267.79501385 / 2326.61759581) / (270.430478612 / 2255.24409235)
=0.40717341 / 0.44919064
=0.9065

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 - (738.322586504 + 138.968304423) / 1767.30633003) / (1 - (689.263056093 + 129.590909091) / 1572.62669246)
=0.50359998 / 0.47930811
=1.0507

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
=2255.24409235 / 2326.61759581
=0.9693

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))
=(52.2554887419 / (52.2554887419 + 129.590909091)) / (53.6378636693 / (53.6378636693 + 138.968304423))
=0.28736059 / 0.27848466
=1.0319

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)
=(755.137533159 / 2255.24409235) / (696.930062655 / 2326.61759581)
=0.33483628 / 0.29954646
=1.1178

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)
=((217.310870947 + 437.382617383) / 1767.30633003) / ((202.572533849 + 395.164410058) / 1572.62669246)
=0.37044709 / 0.38008826
=0.9746

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
=(148.739529556 - 3.30771326484 - 215.084094267) / 1767.30633003
=-0.0394

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.

Stantec Inc has a M-score of -2.68 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.

Stantec Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.80270.96740.76471.12460.66730.8791.41540.78261.00910.9032
GMI 1.56881.1560.94971.00191.05941.01170.81951.2380.9931.0189
AQI 1.16611.58871.04241.02860.98311.10991.00190.96241.00620.926
SGI 1.05181.44351.33091.3461.151.31620.84351.35161.14921.1126
DEPI 0.6541.03840.81131.2220.81750.86291.06380.48951.89981.0257
SGAI 0.55620.8411.04011.02850.93690.99061.21950.80591.00670.9872
LVGI 0.83550.93330.71011.39511.19140.95461.04390.94790.95970.8935
TATA -0.1316-0.0276-0.0553-0.0273-0.1116-0.0412-0.0187-0.0749-0.0399-0.0784
M-score -1.85-1.87-2.60-2.28-3.22-2.45-2.46-2.61-2.41-2.82

Stantec Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.81661.02440.6540.92140.91670.77440.94220.90511.03161.0507
GMI 1.1121.00571.06931.0761.07371.16980.94630.93820.93370.9065
AQI 0.9320.94251.00620.97920.98140.93080.9260.96960.97461.0507
SGI 1.20441.09491.1941.2161.24031.34681.06651.04191.01550.9693
DEPI 0.52280.53971.91721.87241.94091.91811.00291.03691.06361.0319
SGAI 0.89710.99680.93480.92680.92820.84721.06271.07261.07451.1178
LVGI 0.97151.02630.95970.9630.93390.90830.89350.94851.03240.9746
TATA -0.092-0.0956-0.04-0.0406-0.0449-0.0518-0.078-0.0726-0.052-0.0394
M-score -2.89-2.90-2.64-2.39-2.38-2.40-2.87-2.91-2.74-2.68
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