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Universal Forest Products Inc (NAS:UFPI)
Beneish M-Score
-2.57 (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 -2.57 suggests that the company is not a manipulator.

UFPI' s 10-Year Beneish M-Score Range
Min: -3.66   Max: 0.55
Current: -2.57

-3.66
0.55

During the past 13 years, the highest Beneish M-Score of Universal Forest Products Inc was 0.55. The lowest was -3.66. And the median was -2.47.


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 * 0.9069+0.528 * 0.9092+0.404 * 0.931+0.892 * 1.1476+0.115 * 1.0267
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9753+4.679 * -0.0189-0.327 * 0.9439
=-2.57

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $242 Mil.
Revenue was 553.998 + 525.737 + 651.78 + 738.436 = $2,470 Mil.
Gross Profit was 66.012 + 64.868 + 78.289 + 80.216 = $289 Mil.
Total Current Assets was $582 Mil.
Total Assets was $1,007 Mil.
Property, Plant and Equipment(Net PPE) was $241 Mil.
Depreciation, Depletion and Amortization(DDA) was $34 Mil.
Selling, General & Admin. Expense(SGA) was $210 Mil.
Total Current Liabilities was $160 Mil.
Long-Term Debt was $143 Mil.
Net Income was 7.216 + 7.995 + 14.091 + 15.772 = $45 Mil.
Non Operating Income was 0.725 + 0.049 + 0.018 + 0.092 = $1 Mil.
Cash Flow from Operations was -54.732 + 5.623 + 76.655 + 35.657 = $63 Mil.
Accounts Receivable was $233 Mil.
Revenue was 554.494 + 470.763 + 533.366 + 593.693 = $2,152 Mil.
Gross Profit was 57.818 + 44.141 + 55.227 + 72.075 = $229 Mil.
Total Current Assets was $550 Mil.
Total Assets was $967 Mil.
Property, Plant and Equipment(Net PPE) was $228 Mil.
Depreciation, Depletion and Amortization(DDA) was $33 Mil.
Selling, General & Admin. Expense(SGA) was $188 Mil.
Total Current Liabilities was $154 Mil.
Long-Term Debt was $155 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)
=(242.433 / 2469.951) / (232.954 / 2152.316)
=0.09815296 / 0.10823411
=0.9069

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)
=(64.868 / 2152.316) / (66.012 / 2469.951)
=0.10651828 / 0.11716224
=0.9092

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 - (582.352 + 241.419) / 1006.784) / (1 - (550.075 + 228.083) / 966.95)
=0.18177981 / 0.19524484
=0.931

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
=2469.951 / 2152.316
=1.1476

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))
=(33.2 / (33.2 + 228.083)) / (34.097 / (34.097 + 241.419))
=0.12706529 / 0.12375688
=1.0267

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)
=(210.072 / 2469.951) / (187.697 / 2152.316)
=0.08505108 / 0.08720699
=0.9753

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)
=((143.471 + 160.22) / 1006.784) / ((155.181 + 153.828) / 966.95)
=0.30164464 / 0.31957082
=0.9439

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
=(45.074 - 0.884 - 63.203) / 1006.784
=-0.0189

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 -2.57 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.85361.11120.80911.01961.09011.13840.95241.07051.15770.89
GMI 1.12510.90470.93181.16491.07450.78571.19761.10961.00050.9646
AQI 0.90740.93661.19980.92531.20960.99611.01941.02610.90120.9237
SGI 1.2921.09710.990.94320.88830.74941.13020.96381.12761.2022
DEPI 0.91310.92930.98480.92230.92811.04841.05571.03361.06231.0583
SGAI 0.87561.06681.10841.01421.04011.17310.87020.95230.90420.9194
LVGI 0.95330.97350.84020.97090.75330.77150.99040.85781.28940.9974
TATA -0.0058-0.0091-0.0907-0.069-0.1032-0.1321-0.0151-0.0090.0344-0.0114
M-score -2.33-2.42-3.01-2.78-2.79-3.26-2.33-2.36-2.17-2.48

Universal Forest Products Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 1.04060.94770.99331.15771.05291.08021.04440.890.90690.9696
GMI 1.04050.9460.97981.00051.05171.13351.05550.96240.90920.8454
AQI 1.01830.99940.97720.90120.89580.88630.89550.92370.9310.9272
SGI 1.00381.08441.12771.12761.13751.1831.2041.20221.14761.0902
DEPI 1.03591.03511.05191.06231.0881.10161.11091.05831.02671.0139
SGAI 0.920.91160.89790.90580.91340.87560.88980.91780.97531.0351
LVGI 0.89680.9561.01731.28941.25461.2651.19910.99740.94390.9323
TATA -0.076-0.02830.01490.03440.05210.0389-0.007-0.0114-0.0189-0.042
M-score -2.71-2.58-2.30-2.17-2.14-2.09-2.34-2.48-2.57-2.72
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