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Wausau Paper Corp (NYSE:WPP)
Beneish M-Score
-2.91 (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.

Wausau Paper Corp has a M-score of -2.91 suggests that the company is not a manipulator.

WPP' s 10-Year Beneish M-Score Range
Min: -4.08   Max: -1.64
Current: -2.91

-4.08
-1.64

During the past 13 years, the highest Beneish M-Score of Wausau Paper Corp was -1.64. The lowest was -4.08. And the median was -2.60.


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 Wausau Paper Corp 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 * 1.2867+0.528 * 0.7737+0.404 * 0.842+0.892 * 0.6253+0.115 * 0.7835
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1444+4.679 * -0.0204-0.327 * 1.0867
=-2.91

* 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 $26.6 Mil.
Revenue was 89.214 + 77.507 + 91.104 + 91.663 = $349.5 Mil.
Gross Profit was 11.56 + 8.209 + 15.14 + 13.373 = $48.3 Mil.
Total Current Assets was $86.7 Mil.
Total Assets was $458.8 Mil.
Property, Plant and Equipment(Net PPE) was $293.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $102.3 Mil.
Selling, General & Admin. Expense(SGA) was $54.4 Mil.
Total Current Liabilities was $65.6 Mil.
Long-Term Debt was $150.0 Mil.
Net Income was -3.828 + -4.9 + -9.982 + -2.852 = $-21.6 Mil.
Non Operating Income was -0.02 + 0.023 + 0.011 + -0.01 = $0.0 Mil.
Cash Flow from Operations was 1.643 + -7.325 + 3.649 + -10.165 = $-12.2 Mil.
Accounts Receivable was $33.1 Mil.
Revenue was 87.623 + 78.194 + 190.866 + 202.249 = $558.9 Mil.
Gross Profit was 9.813 + 11.276 + 17.11 + 21.543 = $59.7 Mil.
Total Current Assets was $128.8 Mil.
Total Assets was $526.1 Mil.
Property, Plant and Equipment(Net PPE) was $289.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $73.7 Mil.
Selling, General & Admin. Expense(SGA) was $76.0 Mil.
Total Current Liabilities was $77.5 Mil.
Long-Term Debt was $150.0 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)
=(26.634 / 349.488) / (33.104 / 558.932)
=0.07620863 / 0.05922724
=1.2867

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)
=(8.209 / 558.932) / (11.56 / 349.488)
=0.10688599 / 0.13815067
=0.7737

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 - (86.658 + 293.247) / 458.75) / (1 - (128.817 + 289.88) / 526.08)
=0.17186921 / 0.20411915
=0.842

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
=349.488 / 558.932
=0.6253

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))
=(73.66 / (73.66 + 289.88)) / (102.281 / (102.281 + 293.247))
=0.20261869 / 0.25859358
=0.7835

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)
=(54.403 / 349.488) / (76.028 / 558.932)
=0.15566486 / 0.1360237
=1.1444

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)
=((150 + 65.586) / 458.75) / ((150 + 77.511) / 526.08)
=0.46994223 / 0.43246464
=1.0867

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
=(-21.562 - 0.004 - -12.198) / 458.75
=-0.0204

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.

Wausau Paper Corp has a M-score of -2.91 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.

Wausau Paper Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.0771.02790.93941.00910.95720.96540.8910.97871.0685
GMI 0.93782.35450.46561.64480.84171.03992.18490.51270.7764
AQI 1.03971.14450.80411.66390.79381.05131.55950.85791.4872
SGI 1.07131.05421.0831.0440.96081.02280.980.79470.424
DEPI 0.98930.62781.42030.59221.270300.98571.3990.4353
SGAI 1.04660.93121.0260.97531.10161.01970.92261.52271.296
LVGI 1.08641.07661.0451.02381.16841.00261.07741.01081.1035
TATA -0.0574-0.046-0.0259-0.0762-0.0190.0205-0.1261-0.0503-0.1985
M-score -2.67-1.90-2.92-2.23-2.85-2.47-2.35-3.28-3.93

Wausau Paper Corp Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.84040.88451.00080.97871.30740.66130.66911.06850.70911.2867
GMI 1.88571.74681.57470.51270.57330.61850.56090.77640.82620.7737
AQI 1.71991.73641.61640.85790.96911.58791.75771.48721.31620.842
SGI 0.95530.90220.84830.79470.68290.58990.50720.4240.50850.6253
DEPI 0.91251.11321.15961.97892.53320.79180.74550.29270.23070.7835
SGAI 0.92911.0261.30091.52271.5981.56751.22921.2961.13121.1444
LVGI 0.9531.04611.00881.01081.20261.04761.02631.10351.0141.0867
TATA -0.154-0.1454-0.1281-0.0503-0.0671-0.1765-0.1734-0.1985-0.1561-0.0204
M-score -2.61-2.67-2.70-3.21-3.02-4.08-4.04-3.95-4.00-2.91
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