Illumina (FRA:ILU) Beneish M-Score : -2.73 (As of Apr. 29, 2024)

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What is Illumina Beneish M-Score?

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.73 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Illumina's Beneish M-Score or its related term are showing as below:

FRA:ILU' s Beneish M-Score Range Over the Past 10 Years
Min: -3.04 Med: -2.72 Max: -1.54
Current: -2.73

During the past 13 years, the highest Beneish M-Score of Illumina was -1.54. The lowest was -3.04. And the median was -2.72.

Illumina Beneish M-Score Historical Data

The historical data trend for Illumina's Beneish M-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Illumina Beneish M-Score Chart

Illumina Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.43

-3.04

-1.54

-2.75

-2.73

Illumina Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Beneish M-Score	Get a 7-Day Free Trial															-2.75	-2.63	-2.62	-2.72	-2.73

Competitive Comparison of Illumina's Beneish M-Score

For the Diagnostics & Research subindustry, Illumina's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Illumina's Beneish M-Score Distribution in the Medical Diagnostics & Research Industry

For the Medical Diagnostics & Research industry and Healthcare sector, Illumina's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Illumina's Beneish M-Score falls into.

Illumina Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Illumina for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 1.1084

0.528 * 1.0632

0.404 * 1.038

0.892 * 0.9587

0.115 * 0.8451

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.2771

4.679 * -0.076074

0.327 * 0.9071

-2.76

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was €673 Mil.
Revenue was 1028.874 + 1048.503 + 1085.448 + 1015.258 = €4,178 Mil.
Gross Profit was 618.058 + 640.908 + 675.636 + 611.77 = €2,546 Mil.
Total Current Assets was €2,392 Mil.
Total Assets was €9,272 Mil.
Property, Plant and Equipment(Net PPE) was €1,422 Mil.
Depreciation, Depletion and Amortization(DDA) was €401 Mil.
Selling, General, & Admin. Expense(SGA) was €1,497 Mil.
Total Current Liabilities was €1,440 Mil.
Long-Term Debt & Capital Lease Obligation was €1,995 Mil.
Net Income was -160.475 + -706.498 + -215.982 + 2.802 = €-1,080 Mil.
Non Operating Income was -7.336 + -788.954 + -10.153 + -10.274 = €-817 Mil.
Cash Flow from Operations was 205.408 + 130.243 + 96.915 + 9.34 = €442 Mil.

Total Receivables was €633 Mil.
Revenue was 1022.352 + 1126.15 + 1099.252 + 1110.484 = €4,358 Mil.
Gross Profit was 634.368 + 724.17 + 725.582 + 740.02 = €2,824 Mil.
Total Current Assets was €3,362 Mil.
Total Assets was €11,566 Mil.
Property, Plant and Equipment(Net PPE) was €1,646 Mil.
Depreciation, Depletion and Amortization(DDA) was €376 Mil.
Selling, General, & Admin. Expense(SGA) was €1,223 Mil.
Total Current Liabilities was €2,618 Mil.
Long-Term Debt & Capital Lease Obligation was €2,106 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total 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)
	=	(673.078 / 4178.083)	/	(633.424 / 4358.238)
	=	0.161097	/	0.145339
	=	1.1084

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)
	=	(2824.14 / 4358.238)	/	(2546.372 / 4178.083)
	=	0.648	/	0.609459
	=	1.0632

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 Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (2392.453 + 1422.267) / 9271.787)	/	(1 - (3361.584 + 1646.336) / 11565.888)
	=	0.588567	/	0.567009
	=	1.038

4. SGI = Sales Growth Index

Ratio of Revenue 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
	=	4178.083	/	4358.238
	=	0.9587

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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))
	=	(375.646 / (375.646 + 1646.336))	/	(400.771 / (400.771 + 1422.267))
	=	0.185781	/	0.219837
	=	0.8451

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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)
	=	(1497.058 / 4178.083)	/	(1222.792 / 4358.238)
	=	0.358312	/	0.28057
	=	1.2771

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 in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((1995.392 + 1439.69) / 9271.787)	/	((2106.064 + 2617.712) / 11565.888)
	=	0.370488	/	0.408423
	=	0.9071

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
	=	(-1080.153 - -816.717	-	441.906)	/	9271.787
	=	-0.076074

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Illumina has a M-score of -2.76 suggests that the company is unlikely to be a manipulator.

Illumina Beneish M-Score Related Terms

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Illumina (FRA:ILU) Business Description

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Website

https://www.illumina.com

Illumina provides tools and services to analyze genetic material with life science and clinical lab applications. The company generates about 90% of its revenue from sequencing instruments, consumables, and services. Illumina's high-throughput technology enables whole genome sequencing in humans and other large organisms. Its lower throughput tools enable applications that require smaller data outputs, such as viral and cancer tumor screening. Illumina also sells microarrays (about 10% of sales) that enable lower-cost, focused genetic screening with primarily consumer and agricultural applications.

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