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Westell Technologies Inc (NAS:WSTL)
Beneish M-Score
-3.46 (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.

Westell Technologies Inc has a M-score of -3.46 suggests that the company is not a manipulator.

WSTL' s Beneish M-Score Range Over the Past 10 Years
Min: -8.61   Max: 2.24
Current: -3.46

-8.61
2.24

During the past 13 years, the highest Beneish M-Score of Westell Technologies Inc was 2.24. The lowest was -8.61. And the median was -2.83.


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 Westell Technologies 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 * 0.7201+0.528 * 0.872+0.404 * 1.0508+0.892 * 1.0459+0.115 * 0.9257
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9003+4.679 * -0.1546-0.327 * 1.0169
=-3.46

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $10.89 Mil.
Revenue was 14.816 + 20.904 + 20.215 + 25.514 = $81.45 Mil.
Gross Profit was 4.565 + 7.893 + 7.963 + 10.231 = $30.65 Mil.
Total Current Assets was $51.67 Mil.
Total Assets was $73.84 Mil.
Property, Plant and Equipment(Net PPE) was $2.81 Mil.
Depreciation, Depletion and Amortization(DDA) was $6.99 Mil.
Selling, General & Admin. Expense(SGA) was $25.21 Mil.
Total Current Liabilities was $12.64 Mil.
Long-Term Debt was $0.00 Mil.
Net Income was -7.768 + -5.076 + -4.797 + -2.473 = $-20.11 Mil.
Non Operating Income was 0.017 + 0.107 + 0.085 + -0.061 = $0.15 Mil.
Cash Flow from Operations was -3.852 + -4.851 + -0.987 + 0.84 = $-8.85 Mil.
Accounts Receivable was $14.45 Mil.
Revenue was 21.57 + 18.613 + 14.043 + 23.646 = $77.87 Mil.
Gross Profit was 8.429 + 4.666 + 4.395 + 8.065 = $25.56 Mil.
Total Current Assets was $70.61 Mil.
Total Assets was $99.09 Mil.
Property, Plant and Equipment(Net PPE) was $3.76 Mil.
Depreciation, Depletion and Amortization(DDA) was $7.31 Mil.
Selling, General & Admin. Expense(SGA) was $26.78 Mil.
Total Current Liabilities was $16.68 Mil.
Long-Term Debt was $0.00 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)
=(10.885 / 81.449) / (14.452 / 77.872)
=0.13364191 / 0.1855866
=0.7201

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)
=(25.555 / 77.872) / (30.652 / 81.449)
=0.32816674 / 0.37633366
=0.872

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 - (51.665 + 2.809) / 73.835) / (1 - (70.606 + 3.76) / 99.093)
=0.26221981 / 0.24953327
=1.0508

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
=81.449 / 77.872
=1.0459

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))
=(7.306 / (7.306 + 3.76)) / (6.987 / (6.987 + 2.809))
=0.6602205 / 0.71325031
=0.9257

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)
=(25.214 / 81.449) / (26.775 / 77.872)
=0.30956795 / 0.34383347
=0.9003

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)
=((0 + 12.638) / 73.835) / ((0 + 16.679) / 99.093)
=0.17116544 / 0.16831663
=1.0169

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
=(-20.114 - 0.148 - -8.85) / 73.835
=-0.1546

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.

Westell Technologies Inc has a M-score of -3.46 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.

Westell Technologies Inc Annual Data

Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14Mar15Mar16
DSRI 0.93930.93641.19740.86981.68350.79791.3170.89980.90781.3174
GMI 0.91721.111.08130.86591.1310.7141.21070.82011.24380.8144
AQI 0.92910.36680.98040.8492.92250.57750.222910.21640.66160.9066
SGI 0.91850.80130.89210.97620.81470.29510.88952.63020.82421.0485
DEPI 1.01520.83081.0331.02080.98830.71841.12620.83380.99961.0501
SGAI 1.25851.24511.03760.76690.72122.23861.40920.64571.20240.9034
LVGI 1.08341.26841.15390.81240.82360.19191.73082.19041.16261.3872
TATA -0.1637-0.5829-0.0221-0.05910.21690.2361-0.22530.0175-0.4995-0.1252
M-score -3.52-5.79-2.52-2.93-0.05-2.49-3.842.24-5.15-2.97

Westell Technologies Inc Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.89980.63360.39710.56680.90781.1791.82181.85321.31740.7201
GMI 0.82010.90680.99851.20161.24381.18351.07440.92310.81440.872
AQI 10.21642.02932.04581.48130.66160.62320.66630.94520.90661.0508
SGI 2.63022.07231.40551.01830.82420.72480.78850.95531.04851.0459
DEPI 0.83380.9941.07581.09820.99961.05611.14031.13091.05010.9257
SGAI 0.64570.71770.90241.06261.20241.35941.29241.15370.90340.9003
LVGI 2.19041.17180.80080.96981.16261.60781.83811.98481.38721.0169
TATA 0.01750.0129-0.1313-0.353-0.4995-0.5303-0.3918-0.2094-0.1252-0.1546
M-score 2.24-1.44-2.77-4.20-5.15-5.35-4.15-3.11-2.97-3.46
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