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GuruFocus has detected 6 Warning Signs with Axcelis Technologies Inc $ACLS.
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Axcelis Technologies Inc (NAS:ACLS)
Beneish M-Score
-2.14 (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.

Axcelis Technologies Inc has a M-score of -2.14 signals that the company is a manipulator.

ACLS' s Beneish M-Score Range Over the Past 10 Years
Min: -5.51   Max: 0.87
Current: -2.14

-5.51
0.87

During the past 13 years, the highest Beneish M-Score of Axcelis Technologies Inc was 0.87. The lowest was -5.51. And the median was -2.43.


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 Axcelis 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 * 1.4594+0.528 * 0.8884+0.404 * 1.0844+0.892 * 0.9683+0.115 * 1.0388
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0696+4.679 * 0.0642-0.327 * 1.9906
=-2.14

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Mar17) TTM:Last Year (Mar16) TTM:
Accounts Receivable was $67.1 Mil.
Revenue was 86.893 + 69.358 + 65.65 + 64.451 = $286.4 Mil.
Gross Profit was 34.714 + 26.947 + 24.104 + 25.131 = $110.9 Mil.
Total Current Assets was $260.1 Mil.
Total Assets was $322.6 Mil.
Property, Plant and Equipment(Net PPE) was $31.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.5 Mil.
Selling, General & Admin. Expense(SGA) was $50.4 Mil.
Total Current Liabilities was $52.8 Mil.
Long-Term Debt was $47.7 Mil.
Net Income was 9.506 + 3.965 + 2.151 + 2.937 = $18.6 Mil.
Non Operating Income was -0.154 + -0.412 + -0.055 + -0.238 = $-0.9 Mil.
Cash Flow from Operations was -2.668 + 4.216 + 3.69 + -6.524 = $-1.3 Mil.
Accounts Receivable was $47.5 Mil.
Revenue was 67.521 + 70.458 + 79.317 + 78.437 = $295.7 Mil.
Gross Profit was 23.416 + 21.973 + 29.179 + 27.174 = $101.7 Mil.
Total Current Assets was $236.3 Mil.
Total Assets was $293.3 Mil.
Property, Plant and Equipment(Net PPE) was $31.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.6 Mil.
Selling, General & Admin. Expense(SGA) was $48.7 Mil.
Total Current Liabilities was $45.9 Mil.
Long-Term Debt was $0.0 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)
=(67.083 / 286.352) / (47.471 / 295.733)
=0.23426761 / 0.16051979
=1.4594

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)
=(101.742 / 295.733) / (110.896 / 286.352)
=0.3440333 / 0.38727161
=0.8884

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 - (260.084 + 31.486) / 322.607) / (1 - (236.313 + 30.997) / 293.334)
=0.09620684 / 0.08871798
=1.0844

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
=286.352 / 295.733
=0.9683

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))
=(4.645 / (4.645 + 30.997)) / (4.517 / (4.517 + 31.486))
=0.13032378 / 0.12546177
=1.0388

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)
=(50.395 / 286.352) / (48.657 / 295.733)
=0.17598969 / 0.16453017
=1.0696

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)
=((47.681 + 52.835) / 322.607) / ((0 + 45.914) / 293.334)
=0.31157414 / 0.15652464
=1.9906

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
=(18.559 - -0.859 - -1.286) / 322.607
=0.0642

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.

Axcelis Technologies Inc has a M-score of -2.14 signals that the company is likely to 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 local exchange's currency.

Axcelis Technologies Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 1.17830.58461.30671.46540.5221.11251.53111.12690.58021.5491
GMI 1.09841.5091.18620.67640.86831.25590.82361.0051.02430.9043
AQI 1.18321.11840.17280.7551.52930.75841.26390.74341.46071.3116
SGI 0.87670.61810.53162.06891.16060.63670.96191.03791.48480.8855
DEPI 0.95290.70232.25160.99730.83021.11631.21691.04540.93841.15
SGAI 1.13491.54611.27280.48650.87241.36290.92440.9230.72951.1271
LVGI 0.73311.10.41582.04280.72690.76031.59661.06921.4260.9664
TATA 0.0141-0.3166-0.151-0.02740.0046-0.0988-0.00440.0143-0.01060.068
M-score -2.18-4.53-3.27-1.75-2.52-3.10-2.19-2.37-2.38-1.68

Axcelis Technologies Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 1.12691.12281.0850.87710.58020.80911.3561.2741.54911.4594
GMI 1.0051.06741.06411.08721.02430.96850.94460.95090.90430.8884
AQI 0.74340.57610.83960.7811.46072.1171.72241.98891.31161.0844
SGI 1.03790.99881.20721.47451.48481.37231.11460.91320.88550.9683
DEPI 1.04541.00290.97360.94130.93841.01261.02351.08371.151.0388
SGAI 0.9230.95080.80480.71640.72950.79780.96881.09571.12711.0696
LVGI 1.06921.73911.79951.61681.4260.44130.49630.410.96641.9906
TATA 0.0143-0.0255-0.01890.0143-0.01060.05330.07530.0530.0680.0642
M-score -2.37-2.86-2.57-2.31-2.38-1.42-1.26-1.50-1.68-2.14
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