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Vulcan Materials Company (NYSE:VMC)
Beneish M-Score
-2.50 (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.

Vulcan Materials Company has a M-score of -2.50 suggests that the company is not a manipulator.

VMC' s 10-Year Beneish M-Score Range
Min: -3.08   Max: -1.94
Current: -2.5

-3.08
-1.94

During the past 13 years, the highest Beneish M-Score of Vulcan Materials Company was -1.94. The lowest was -3.08. And the median was -2.71.


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 Vulcan Materials Company 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 * 1.0796+0.528 * 0.8445+0.404 * 0.9872+0.892 * 1.0792+0.115 * 1.1205
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.6215+4.679 * -0.0367-0.327 * 0.937
=-2.50

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $323 Mil.
Revenue was 680.246 + 813.568 + 738.733 + 538.162 = $2,771 Mil.
Gross Profit was 117.347 + 158.983 + 132.895 + 17.655 = $427 Mil.
Total Current Assets was $951 Mil.
Total Assets was $8,259 Mil.
Property, Plant and Equipment(Net PPE) was $3,312 Mil.
Depreciation, Depletion and Amortization(DDA) was $307 Mil.
Selling, General & Admin. Expense(SGA) was $259 Mil.
Total Current Liabilities was $299 Mil.
Long-Term Debt was $2,522 Mil.
Net Income was 9.082 + 41.363 + 28.772 + -54.836 = $24 Mil.
Non Operating Income was -42.336 + 15.586 + 0.286 + -2.373 = $-29 Mil.
Cash Flow from Operations was 96.487 + 305.357 + -32.478 + -12.867 = $356 Mil.
Accounts Receivable was $278 Mil.
Revenue was 608.431 + 728.861 + 694.136 + 535.882 = $2,567 Mil.
Gross Profit was 79.206 + 126.923 + 105.939 + 21.958 = $334 Mil.
Total Current Assets was $985 Mil.
Total Assets was $8,127 Mil.
Property, Plant and Equipment(Net PPE) was $3,159 Mil.
Depreciation, Depletion and Amortization(DDA) was $332 Mil.
Selling, General & Admin. Expense(SGA) was $387 Mil.
Total Current Liabilities was $436 Mil.
Long-Term Debt was $2,526 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)
=(323.369 / 2770.709) / (277.539 / 2567.31)
=0.11670984 / 0.10810498
=1.0796

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)
=(158.983 / 2567.31) / (117.347 / 2770.709)
=0.13010739 / 0.15406887
=0.8445

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 - (951.496 + 3312.017) / 8259.143) / (1 - (984.972 + 3159.185) / 8126.599)
=0.48378264 / 0.49005027
=0.9872

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
=2770.709 / 2567.31
=1.0792

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))
=(331.959 / (331.959 + 3159.185)) / (307.108 / (307.108 + 3312.017))
=0.09508602 / 0.08485698
=1.1205

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)
=(259.427 / 2770.709) / (386.77 / 2567.31)
=0.09363199 / 0.15065185
=0.6215

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)
=((2522.243 + 299.135) / 8259.143) / ((2526.401 + 436.411) / 8126.599)
=0.34160663 / 0.36458203
=0.937

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
=(24.381 - -28.837 - 356.499) / 8259.143
=-0.0367

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.

Vulcan Materials Company has a M-score of -2.50 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.

Vulcan Materials Company Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.73621.43390.71181.08240.77121.0191.24670.93930.92671.0796
GMI 1.01350.96970.87810.97571.39171.23871.41041.06170.85080.8445
AQI 1.01621.17861.05631.92780.93181.05961.02651.01711.02150.9872
SGI 1.06261.17971.15440.99561.09730.73680.95111.00221.00111.0792
DEPI 0.92841.12751.12931.54860.81490.92610.97170.99461.00581.1205
SGAI 1.07660.96320.9851.10071.07811.27411.07080.89021.03410.7946
LVGI 0.88930.89370.93931.92270.94260.81471.02941.04490.97190.937
TATA -0.0888-0.0304-0.0482-0.0342-0.0482-0.0502-0.0363-0.0291-0.0366-0.0411
M-score -3.05-1.95-2.84-2.46-2.67-2.78-2.26-2.63-2.78-2.55

Vulcan Materials Company Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.07310.93931.11750.96760.91070.92671.02981.03381.06831.0796
GMI 1.20921.06170.95760.88220.80230.85080.93320.89470.8880.8445
AQI 1.01971.01711.01191.02511.0261.02151.02791.01950.99760.9872
SGI 0.98961.00221.02371.03451.01471.00110.98331.00341.04871.0792
DEPI 0.9890.99460.99140.99291.00171.00581.03831.07351.09331.1205
SGAI 0.91350.89110.88930.96871.01321.32071.32021.11721.08360.6215
LVGI 1.04281.04491.04491.00531.01220.97190.96680.93410.90290.937
TATA -0.0341-0.0291-0.0265-0.0284-0.026-0.0427-0.0382-0.0323-0.0564-0.0367
M-score -2.46-2.63-2.49-2.66-2.77-2.86-2.71-2.63-2.67-2.50
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