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Westport Innovations Inc (NAS:WPRT)
Beneish M-Score
-3.87 (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.

Westport Innovations Inc has a M-score of -3.93 suggests that the company is not a manipulator.

WPRT' s 10-Year Beneish M-Score Range
Min: -3.87   Max: 229.1
Current: -3.87

-3.87
229.1

During the past 13 years, the highest Beneish M-Score of Westport Innovations Inc was 229.10. The lowest was -3.87. And the median was -2.44.


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 Westport Innovations 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 * 0.9408+0.528 * 0.3858+0.404 * 1.2345+0.892 * 0.8209+0.115 * 0.8013
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0663+4.679 * -0.169-0.327 * 1.54
=-3.93

* 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 $40.5 Mil.
Revenue was 27.395 + 25.301 + 40.036 + 41.923 = $134.7 Mil.
Gross Profit was -1.196 + 7.969 + 13.601 + 12.272 = $32.6 Mil.
Total Current Assets was $190.9 Mil.
Total Assets was $337.7 Mil.
Property, Plant and Equipment(Net PPE) was $58.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $18.7 Mil.
Selling, General & Admin. Expense(SGA) was $65.8 Mil.
Total Current Liabilities was $86.3 Mil.
Long-Term Debt was $59.6 Mil.
Net Income was -64.92 + -25.476 + -35.358 + -23.866 = $-149.6 Mil.
Non Operating Income was 11.402 + 2.135 + 1.041 + -0.356 = $14.2 Mil.
Cash Flow from Operations was -23.35 + -31.377 + -28.937 + -23.093 = $-106.8 Mil.
Accounts Receivable was $52.4 Mil.
Revenue was 52.595 + 46.528 + 34.856 + 30.053 = $164.0 Mil.
Gross Profit was -17.067 + 16.057 + 8.257 + 8.095 = $15.3 Mil.
Total Current Assets was $319.7 Mil.
Total Assets was $491.7 Mil.
Property, Plant and Equipment(Net PPE) was $67.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $16.3 Mil.
Selling, General & Admin. Expense(SGA) was $75.2 Mil.
Total Current Liabilities was $125.0 Mil.
Long-Term Debt was $13.0 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)
=(40.505 / 134.655) / (52.445 / 164.032)
=0.30080576 / 0.3197242
=0.9408

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)
=(7.969 / 164.032) / (-1.196 / 134.655)
=0.09353053 / 0.2424418
=0.3858

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 - (190.875 + 58.134) / 337.695) / (1 - (319.726 + 67.349) / 491.671)
=0.2626216 / 0.21273575
=1.2345

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
=134.655 / 164.032
=0.8209

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))
=(16.288 / (16.288 + 67.349)) / (18.666 / (18.666 + 58.134))
=0.19474634 / 0.24304688
=0.8013

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)
=(65.809 / 134.655) / (75.182 / 164.032)
=0.48872303 / 0.4583374
=1.0663

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)
=((59.587 + 86.333) / 337.695) / ((12.988 + 124.967) / 491.671)
=0.43210589 / 0.28058397
=1.54

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
=(-149.62 - 14.222 - -106.757) / 337.695
=-0.169

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.

Westport Innovations Inc has a M-score of -3.93 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.

Westport Innovations Inc Annual Data

Mar05Mar06Mar07Mar08Mar09Mar10Mar11Dec12Dec13Dec14
DSRI 1.12120.80341.27680.54610.53611.77761.07192.54541.25160.9703
GMI 0.98620.90540.93691.16111.24420.79570.82461.1293.65080.3741
AQI 0.89051.46190.81311.08940.18930.49953.21892.52470.92211.2345
SGI 1.1511.31231.40341.32571.38831.26081.21711.05111.0540.796
DEPI 0.74741.27461.53380.90281.4510.84151.09061.35790.84080.8013
SGAI 0.71990.89080.93811.00440.86141.19211.07451.88220.9521.0996
LVGI 1.37741.58471.03940.6850.88660.84190.84711.1491.03681.54
TATA -0.2081-0.12750.01570.0212-0.2096-0.1114-0.0695-0.0596-0.1669-0.169
M-score -3.36-2.98-1.84-2.30-3.63-2.36-1.69-0.77-1.64-3.93

Westport Innovations Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.642811.06250.83721.06181.25161.05040.99350.90180.9408
GMI 1.02331.0470.88051.25371.13373.65083.15292.01932.88540.3858
AQI 0.62450.75821.3811.70961.84020.92210.91640.77080.74951.2345
SGI 0.56830.94870.9250.8161.30821.0541.17481.33631.05610.8209
DEPI 0.9326.1070.98361.10011.00710.84080.82150.79380.7510.8013
SGAI 1.68871.94221.78322.05431.28890.9520.83030.64170.73881.0663
LVGI 0.62120.66141.09341.24041.20511.03680.96661.03391.07361.54
TATA -0.0436-0.0603-0.0549-0.0836-0.03-0.1669-0.1838-0.1867-0.2017-0.169
M-score -2.62-2.34-2.82-3.01-1.99-1.64-2.02-2.59-2.58-3.93
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