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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 -2.66 suggests that the company is not a manipulator.

STN' s 10-Year Beneish M-Score Range
Min: -3.02   Max: -0.02
Current: -2.62

-3.02
-0.02

During the past 13 years, the highest Beneish M-Score of Stantec Inc was -0.02. The lowest was -3.02. 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 * 0.9769+0.528 * 1.0023+0.404 * 0.9746+0.892 * 1.0918+0.115 * 1.0755
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0007+4.679 * -0.05-0.327 * 1.0324
=-2.66

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $597 Mil.
Revenue was 590.148044693 + 522.195632393 + 781.857404022 + 467.912162162 = $2,362 Mil.
Gross Profit was 270.039106145 + 238.064604186 + 232.753199269 + 253.852316602 = $995 Mil.
Total Current Assets was $752 Mil.
Total Assets was $1,753 Mil.
Property, Plant and Equipment(Net PPE) was $140 Mil.
Depreciation, Depletion and Amortization(DDA) was $52 Mil.
Selling, General & Admin. Expense(SGA) was $739 Mil.
Total Current Liabilities was $388 Mil.
Long-Term Debt was $301 Mil.
Net Income was 41.2523277467 + 30.5122838944 + 32.5968921389 + 44.3648648649 = $149 Mil.
Non Operating Income was 0.024208566108 + 0.222929936306 + 2.7084095064 + 1.22104247104 = $4 Mil.
Cash Flow from Operations was 17.3575418994 + -3.29845313922 + 110.3976234 + 107.673745174 = $232 Mil.
Accounts Receivable was $560 Mil.
Revenue was 544.926923077 + 503.637880275 + 712.260080645 + 402.600810537 = $2,163 Mil.
Gross Profit was 244.714423077 + 226.032384691 + 220.768145161 + 221.597771023 = $913 Mil.
Total Current Assets was $619 Mil.
Total Assets was $1,501 Mil.
Property, Plant and Equipment(Net PPE) was $126 Mil.
Depreciation, Depletion and Amortization(DDA) was $52 Mil.
Selling, General & Admin. Expense(SGA) was $676 Mil.
Total Current Liabilities was $331 Mil.
Long-Term Debt was $240 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)
=(597.112662942 / 2362.11324327) / (559.819230769 / 2163.42569453)
=0.25278748 / 0.25876518
=0.9769

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)
=(238.064604186 / 2163.42569453) / (270.039106145 / 2362.11324327)
=0.42206799 / 0.42110988
=1.0023

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 - (752.301675978 + 139.691806331) / 1752.97765363) / (1 - (618.802884615 + 125.928846154) / 1501.27980769)
=0.49115525 / 0.50393542
=0.9746

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
=2362.11324327 / 2163.42569453
=1.0918

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))
=(51.6614434741 / (51.6614434741 + 125.928846154)) / (51.789797881 / (51.789797881 + 139.691806331))
=0.29090241 / 0.27046879
=1.0755

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)
=(738.704114757 / 2362.11324327) / (676.115223393 / 2163.42569453)
=0.31273019 / 0.31252066
=1.0007

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)
=((300.658286778 + 388.075418994) / 1752.97765363) / ((240.454807692 + 330.850961538) / 1501.27980769)
=0.3928936 / 0.38054583
=1.0324

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
=(148.726368645 - 4.17659047985 - 232.130457334) / 1752.97765363
=-0.05

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 -2.66 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 1.80270.96740.77961.12360.67480.89441.14591.67280.80870.8881
GMI 1.56881.1560.94971.00191.05941.01171.01140.82151.21261.0189
AQI 1.16611.58871.04241.02860.97141.12330.98750.97641.00620.926
SGI 1.03311.45681.29921.36191.16771.31911.04560.8941.38541.0843
DEPI 0.6541.03840.81131.2220.85520.82481.07970.48221.89981.0257
SGAI 0.55620.8411.04011.02850.93690.99060.98861.21410.82440.9872
LVGI 0.83550.93330.71011.39511.19140.95461.05660.93650.95970.8935
TATA -0.1316-0.0276-0.0553-0.0273-0.1116-0.0372-0.0227-0.0749-0.0399-0.0784
M-score -1.87-1.86-2.62-2.27-3.20-2.41-2.42-2.49-2.24-2.85

Stantec Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 1.09870.97690.99140.77510.790.80960.80620.84680.89050.9769
GMI 0.91751.01291.06031.30561.24531.18221.17841.01831.0091.0023
AQI 0.93790.9320.94251.00620.97920.98140.93080.9260.96960.9746
SGI 1.00831.08021.14731.44551.40351.35711.34871.13721.1111.0918
DEPI 0.48770.51980.54481.91331.88311.92921.93340.9911.04751.0755
SGAI 1.090.99010.94740.76550.80080.8430.8410.98730.99721.0007
LVGI 0.9730.97151.02630.95970.9630.93390.90830.89350.94851.0324
TATA -0.0794-0.0913-0.097-0.0396-0.0398-0.0448-0.0527-0.0787-0.0702-0.05
M-score -2.89-2.92-2.85-2.15-2.23-2.30-2.36-2.85-2.79-2.66
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