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Universal Forest Products Inc (NAS:UFPI)
Beneish M-Score
-2.56 (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.

Universal Forest Products Inc has a M-score of -2.56 suggests that the company is not a manipulator.

UFPI' s 10-Year Beneish M-Score Range
Min: -3.35   Max: 0.55
Current: -2.56

-3.35
0.55

During the past 13 years, the highest Beneish M-Score of Universal Forest Products Inc was 0.55. The lowest was -3.35. And the median was -2.42.


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 Universal Forest Products 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 * 1.0082+0.528 * 0.9307+0.404 * 0.9903+0.892 * 1.0769+0.115 * 0.9705
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0439+4.679 * -0.0156-0.327 * 1.097
=-2.56

* 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 $196 Mil.
Revenue was 620.09 + 713.489 + 772.752 + 553.998 = $2,660 Mil.
Gross Profit was 72.755 + 89.586 + 96.988 + 66.012 = $325 Mil.
Total Current Assets was $573 Mil.
Total Assets was $1,024 Mil.
Property, Plant and Equipment(Net PPE) was $248 Mil.
Depreciation, Depletion and Amortization(DDA) was $36 Mil.
Selling, General & Admin. Expense(SGA) was $230 Mil.
Total Current Liabilities was $175 Mil.
Long-Term Debt was $99 Mil.
Net Income was 9.313 + 19.234 + 21.789 + 7.216 = $58 Mil.
Non Operating Income was 0.132 + 0.118 + 0.078 + 0.051 = $0 Mil.
Cash Flow from Operations was 2.592 + 47.724 + 77.536 + -54.732 = $73 Mil.
Accounts Receivable was $180 Mil.
Revenue was 525.737 + 651.78 + 738.436 + 554.494 = $2,470 Mil.
Gross Profit was 64.868 + 78.289 + 80.216 + 57.818 = $281 Mil.
Total Current Assets was $496 Mil.
Total Assets was $917 Mil.
Property, Plant and Equipment(Net PPE) was $237 Mil.
Depreciation, Depletion and Amortization(DDA) was $34 Mil.
Selling, General & Admin. Expense(SGA) was $204 Mil.
Total Current Liabilities was $139 Mil.
Long-Term Debt was $85 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)
=(195.912 / 2660.329) / (180.452 / 2470.447)
=0.07364202 / 0.07304427
=1.0082

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)
=(89.586 / 2470.447) / (72.755 / 2660.329)
=0.11382191 / 0.12229352
=0.9307

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 - (573.006 + 248.269) / 1023.8) / (1 - (496.398 + 237.41) / 916.987)
=0.19781696 / 0.19976183
=0.9903

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
=2660.329 / 2470.447
=1.0769

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))
=(33.564 / (33.564 + 237.41)) / (36.323 / (36.323 + 248.269))
=0.12386428 / 0.12763184
=0.9705

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)
=(229.773 / 2660.329) / (204.392 / 2470.447)
=0.08637014 / 0.08273482
=1.0439

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)
=((98.645 + 175.46) / 1023.8) / ((84.7 + 139.099) / 916.987)
=0.26773296 / 0.24405908
=1.097

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
=(57.552 - 0.379 - 73.12) / 1023.8
=-0.0156

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.

Universal Forest Products Inc has a M-score of -2.56 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.

Universal Forest Products Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.11120.80911.01961.09011.0381.04461.0421.13690.91961.0082
GMI 0.90470.93181.16491.07990.78181.19761.10961.00050.96460.9286
AQI 0.93661.19980.92531.20960.99611.01941.02610.90120.92370.9903
SGI 1.09710.990.94320.88830.74941.13020.96381.12761.20221.0769
DEPI 0.92930.98480.92230.91931.05841.05571.03361.06231.05830.9705
SGAI 1.06681.10841.01421.04011.17310.87020.95230.90420.91941.044
LVGI 0.97350.84020.97090.75330.77150.99040.85781.28940.99741.097
TATA -0.0091-0.0907-0.069-0.1032-0.1321-0.0151-0.0090.0344-0.0126-0.0156
M-score -2.42-3.01-2.78-2.79-3.35-2.25-2.39-2.19-2.46-2.56

Universal Forest Products Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 1.13691.06431.08021.05130.91960.90690.96961.00071.00820.9704
GMI 1.00051.05171.13351.05550.96240.90920.84540.87160.93070.947
AQI 0.90120.89580.88630.89550.92370.9310.92720.92150.99030.9555
SGI 1.12761.13751.1831.2041.20221.14761.09021.06231.07691.1091
DEPI 1.06231.0881.10161.11091.05831.02671.01390.96710.97050.9552
SGAI 0.90580.91340.87560.88980.91780.97531.03511.05321.04391.0197
LVGI 1.28941.25461.2651.19910.99740.94390.93231.02491.0971.142
TATA 0.03440.05210.0355-0.007-0.0126-0.0193-0.0507-0.021-0.0156-0.0155
M-score -2.19-2.13-2.11-2.33-2.46-2.57-2.76-2.64-2.56-2.58
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