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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: -3.61   Max: 0.55
Current: -2.57

-3.61
0.55

During the past 13 years, the highest Beneish M-Score of Universal Forest Products Inc was 0.55. The lowest was -3.61. And the median was -2.53.


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 * 0.9431+0.528 * 0.9676+0.404 * 0.992+0.892 * 1.12+0.115 * 0.9179
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0212+4.679 * -0.0201-0.327 * 1.0675
=-2.57

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $303 Mil.
Revenue was 838.171 + 633.025 + 620.09 + 713.489 = $2,805 Mil.
Gross Profit was 112.443 + 79.582 + 72.755 + 89.586 = $354 Mil.
Total Current Assets was $679 Mil.
Total Assets was $1,140 Mil.
Property, Plant and Equipment(Net PPE) was $258 Mil.
Depreciation, Depletion and Amortization(DDA) was $40 Mil.
Selling, General & Admin. Expense(SGA) was $247 Mil.
Total Current Liabilities was $234 Mil.
Long-Term Debt was $122 Mil.
Net Income was 25.976 + 10.162 + 9.313 + 19.234 = $65 Mil.
Non Operating Income was 0.112 + 0.083 + 0.132 + 0.118 = $0 Mil.
Cash Flow from Operations was 87.367 + -50.545 + 2.592 + 47.724 = $87 Mil.
Accounts Receivable was $286 Mil.
Revenue was 772.752 + 553.998 + 525.737 + 651.78 = $2,504 Mil.
Gross Profit was 96.988 + 66.012 + 64.868 + 78.289 = $306 Mil.
Total Current Assets was $591 Mil.
Total Assets was $1,022 Mil.
Property, Plant and Equipment(Net PPE) was $247 Mil.
Depreciation, Depletion and Amortization(DDA) was $35 Mil.
Selling, General & Admin. Expense(SGA) was $216 Mil.
Total Current Liabilities was $204 Mil.
Long-Term Debt was $95 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)
=(302.538 / 2804.775) / (286.422 / 2504.267)
=0.10786534 / 0.11437359
=0.9431

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)
=(79.582 / 2504.267) / (112.443 / 2804.775)
=0.12225414 / 0.12634382
=0.9676

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 - (679.444 + 257.731) / 1139.666) / (1 - (591.4 + 247.453) / 1021.879)
=0.17767574 / 0.17910731
=0.992

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
=2804.775 / 2504.267
=1.12

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))
=(34.619 / (34.619 + 247.453)) / (39.779 / (39.779 + 257.731))
=0.12273108 / 0.13370643
=0.9179

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)
=(247.012 / 2804.775) / (215.959 / 2504.267)
=0.08806838 / 0.08623641
=1.0212

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)
=((122.303 + 234.249) / 1139.666) / ((95.094 + 204.398) / 1021.879)
=0.31285657 / 0.29307971
=1.0675

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
=(64.685 - 0.445 - 87.138) / 1139.666
=-0.0201

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

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

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.06431.08021.05130.91960.90690.96961.00071.00820.97040.9431
GMI 1.05171.13351.05550.96240.90920.84540.87160.93070.9470.9676
AQI 0.89580.88630.89550.92370.9310.92720.92150.99030.95550.992
SGI 1.13751.1831.2041.20221.14761.09021.06231.07691.10911.12
DEPI 1.0881.10161.11091.05831.02671.01390.96710.97050.95520.9179
SGAI 0.91340.87560.88980.91780.97531.03511.05321.04391.01971.0212
LVGI 1.25461.2651.19910.99740.94390.93231.02491.0971.1421.0675
TATA 0.05210.0355-0.007-0.0126-0.0303-0.0507-0.021-0.0156-0.0053-0.0201
M-score -2.13-2.11-2.33-2.46-2.63-2.76-2.64-2.56-2.54-2.57
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