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Zoltek Companies, Inc. (NAS:ZOLT)
Beneish M-Score
0.00 (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.

Zoltek Companies, Inc. has a M-score of -2.94 suggests that the company is not a manipulator.

During the past 13 years, the highest Beneish M-Score of Zoltek Companies, Inc. was 0.00. The lowest was 0.00. And the median was 0.00.

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 Zoltek Companies, 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 * 1.114 + 0.528 * 1.2726 + 0.404 * 0.7937 + 0.892 * 0.7975 + 0.115 * 0.9543 - 0.172 * SGAI + 4.679 * TATA - 0.327 * LVGI - 0.172 * 1.3576 + 4.679 * -0.0963 - 0.327 * 0.7691 = -2.94

* 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 \$26.2 Mil. Revenue was 35.123 + 40.958 + 30.31 + 33.306 = \$139.7 Mil. Gross Profit was 5.281 + 7.519 + 6.202 + 7.032 = \$26.0 Mil. Total Current Assets was \$146.9 Mil. Total Assets was \$356.1 Mil. Property, Plant and Equipment(Net PPE) was \$208.7 Mil. Depreciation, Depletion and Amortization(DDA) was \$18.5 Mil. Selling, General & Admin. Expense(SGA) was \$14.1 Mil. Total Current Liabilities was \$22.4 Mil. Long-Term Debt was \$17.6 Mil. Net Income was -2.264 + -0.15 + -0.897 + 3.306 = \$-0.0 Mil. Non Operating Income was -1.817 + -1.449 + -1.211 + 1.72 = \$-2.8 Mil. Cash Flow from Operations was 13.222 + 12.041 + 4.577 + 7.209 = \$37.0 Mil. Accounts Receivable was \$29.4 Mil. Revenue was 35.877 + 44.199 + 48.078 + 47.014 = \$175.2 Mil. Gross Profit was 9.077 + 10.22 + 11.278 + 10.968 = \$41.5 Mil. Total Current Assets was \$143.4 Mil. Total Assets was \$358.4 Mil. Property, Plant and Equipment(Net PPE) was \$214.6 Mil. Depreciation, Depletion and Amortization(DDA) was \$18.1 Mil. Selling, General & Admin. Expense(SGA) was \$13.0 Mil. Total Current Liabilities was \$24.1 Mil. Long-Term Debt was \$28.2 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of daysÂ’ 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) = (26.164 / 139.697) / (29.449 / 175.168) = 0.18729107 / 0.16811861 = 1.114

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) = (41.543 / 175.168) / (26.034 / 139.697) = 0.2371609 / 0.18636048 = 1.2726

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 - (146.929 + 208.727) / 356.051) / (1 - (143.356 + 214.592) / 358.449) = 0.00110939 / 0.00139769 = 0.7937

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 = 139.697 / 175.168 = 0.7975

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)) = (18.075 / (18.075 + 214.592)) / (18.497 / (18.497 + 208.727)) = 0.07768614 / 0.08140425 = 0.9543

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) = (14.119 / 139.697) / (13.041 / 175.168) = 0.10106874 / 0.07444853 = 1.3576

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) = ((17.597 + 22.374) / 356.051) / ((28.173 + 24.146) / 358.449) = 0.11226201 / 0.1459594 = 0.7691

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 = (-0.005 - -2.757 - 37.049) / 356.051 = -0.0963

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.

Zoltek Companies, Inc. has a M-score of -2.94 suggests that the company will not be a manipulator.

Related Terms

Historical Data

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

Zoltek Companies, Inc. Annual Data

 Sep04 Sep05 Sep06 Sep07 Sep08 Sep09 Sep10 Sep11 Sep12 Sep13 DSRI 1.0913 0.5961 0.9187 1.3494 0.9255 0.956 0.8078 1.1266 0.9634 1.1717 GMI 0.9866 3.3653 0.1915 0.8423 1.0417 1.2489 2.1356 0.8867 0.4764 1.1533 AQI 1.256 0.9428 0.5187 0.5871 0.2396 0.5129 0.6025 0.364 6.2185 0.9862 SGI 1.025 1.604 1.6678 1.6337 1.2302 0.7475 0.9258 1.1808 1.2284 0.7537 DEPI 0.7736 0.6827 0.8705 1.6942 1.6927 0.9017 0.9019 0.8682 1 0.9599 SGAI 0.2844 0.8311 1.3729 0.7468 1.4876 1.1383 0.8591 0.7497 0.7614 1.4332 LVGI 1.1497 0.8877 0.8598 0.4385 1.1525 0.6028 0.697 1.1323 1.4522 0.7908 TATA -0.0489 -0.0805 -0.0826 0.0094 -0.0129 -0.0409 -0.0964 -0.0079 0.019 -0.0381 M-score -2.46 -1.43 -3.00 -1.49 -2.74 -2.91 -2.62 -2.57 -0.50 -2.66

Zoltek Companies, Inc. Quarterly Data

 Sep11 Dec11 Mar12 Jun12 Sep12 Dec12 Mar13 Jun13 Sep13 Dec13 DSRI 1.1266 1.4533 1.1573 0.9914 0.9634 0.8423 0.7676 0.833 1.1717 1.114 GMI 0.8868 0.627 0.4998 0.4472 0.4763 0.6813 0.8627 1.0049 1.1533 1.2726 AQI 0.364 0.3803 1.949 3.7131 6.2185 9.0988 2.3255 1.0229 0.9862 0.7937 SGI 1.1808 1.2522 1.2247 1.3264 1.2284 1.0561 0.9185 0.7756 0.7537 0.7975 DEPI 0.8682 0.8473 0.8539 0.8538 1 1.0322 0.9607 0.9815 0.9599 0.9543 SGAI 0.7497 0.776 0.8349 0.7558 0.7614 0.8928 1.028 1.2745 1.4332 1.3576 LVGI 1.1323 1.394 1.4183 1.5309 1.4522 1.287 0.9873 0.633 0.7908 0.7691 TATA -0.0079 0.0473 0.0495 0.0327 0.0189 0.0276 -0.0045 -0.0193 -0.0381 -0.0963 M-score -2.57 -2.17 -1.91 -1.39 -0.50 0.59 -2.33 -2.84 -2.66 -2.94
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