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Fortive (NYSE:FTV) Beneish M-Score

: -2.59 (As of Today)
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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 -2.59 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

FTV' s Beneish M-Score Range Over the Past 10 Years
Min: -3.43   Med: -2.59   Max: -1.53
Current: -2.59

During the past 11 years, the highest Beneish M-Score of Fortive was -1.53. The lowest was -3.43. And the median was -2.59.


Fortive Beneish M-Score Historical Data

The historical data trend for Fortive'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.

Fortive Annual Data
Trend Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22
Beneish M-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -1.53 -2.88 -2.82 -2.35 -2.59

Fortive Quarterly Data
Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.35 -2.52 -2.49 -2.57 -2.59

Competitive Comparison

For the Scientific & Technical Instruments subindustry, Fortive'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.

   

Fortive Beneish M-Score Distribution

For the Hardware industry and Technology sector, Fortive's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Fortive's Beneish M-Score falls in comparison to its industry or sector. The grey bar indicates the Beneish M-Score's extreme value range as defined by GuruFocus.



Fortive 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 Fortive 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 * 0.9294+0.528 * 0.9912+0.404 * 1.0061+0.892 * 1.1087+0.115 * 0.7799
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9594+4.679 * -0.0324-0.327 * 0.9111
=-2.59

* 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.

This Year (Dec22) TTM:Last Year (Dec21) TTM:
Total Receivables was $959 Mil.
Revenue was 1529.9 + 1456 + 1463.3 + 1376.5 = $5,826 Mil.
Gross Profit was 892.5 + 845.4 + 833.5 + 792 = $3,363 Mil.
Total Current Assets was $2,477 Mil.
Total Assets was $15,891 Mil.
Property, Plant and Equipment(Net PPE) was $422 Mil.
Depreciation, Depletion and Amortization(DDA) was $466 Mil.
Selling, General, & Admin. Expense(SGA) was $1,957 Mil.
Total Current Liabilities was $2,727 Mil.
Long-Term Debt & Capital Lease Obligation was $2,252 Mil.
Net Income was 227.2 + 189.9 + 173 + 165.1 = $755 Mil.
Non Operating Income was -2.4 + -9.1 + -19.3 + -2.7 = $-34 Mil.
Cash Flow from Operations was 464.2 + 329.8 + 294.4 + 214.8 = $1,303 Mil.
Total Receivables was $930 Mil.
Revenue was 1374.8 + 1301 + 1319.7 + 1259.2 = $5,255 Mil.
Gross Profit was 794 + 745.7 + 755.5 + 711.9 = $3,007 Mil.
Total Current Assets was $2,515 Mil.
Total Assets was $16,466 Mil.
Property, Plant and Equipment(Net PPE) was $571 Mil.
Depreciation, Depletion and Amortization(DDA) was $396 Mil.
Selling, General, & Admin. Expense(SGA) was $1,840 Mil.
Total Current Liabilities was $3,715 Mil.
Long-Term Debt & Capital Lease Obligation was $1,947 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)
=(958.5 / 5825.7) / (930.2 / 5254.7)
=0.16452958 / 0.17702248
=0.9294

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)
=(3007.1 / 5254.7) / (3363.4 / 5825.7)
=0.57226864 / 0.57733835
=0.9912

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 - (2477 + 421.9) / 15890.6) / (1 - (2514.9 + 571.1) / 16465.5)
=0.81757139 / 0.81257781
=1.0061

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
=5825.7 / 5254.7
=1.1087

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))
=(395.5 / (395.5 + 571.1)) / (465.6 / (465.6 + 421.9))
=0.40916615 / 0.52461972
=0.7799

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)
=(1956.6 / 5825.7) / (1839.5 / 5254.7)
=0.33585664 / 0.35006756
=0.9594

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)
=((2251.6 + 2727.1) / 15890.6) / ((1947.2 + 3714.9) / 16465.5)
=0.31331101 / 0.34387659
=0.9111

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
=(755.2 - -33.5 - 1303.2) / 15890.6
=-0.0324

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.

Fortive has a M-score of -2.59 suggests that the company is unlikely to be a manipulator.


Fortive Beneish M-Score Related Terms

Thank you for viewing the detailed overview of Fortive's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.


Fortive (NYSE:FTV) Business Description

Fortive logo
Traded in Other Exchanges
Address
6920 Seaway Boulevard, Everett, WA, USA, 98203
Fortive is a diversified industrial technology firm with a broad portfolio of mission-critical products and services that include field solutions, product realization, health, and sensing technologies. The company serves a wide range of end markets, including manufacturing, utilities, medical, and electronics. Fortive generated roughly $5.3 billion in revenue and $1.2 billion in adjusted operating income in 2021.
Executives
Eric Branderiz director 915 DEGUIGNE DRIVE, PO BOX 3453, SUNNYVALE CA 94088-3453
Tamara S. Newcombe officer: President & CEO of PT 6920 SEAWAY BLVD., EVERETT WA 98203
Wright Iii Lassiter director 500 PLAZA DRIVE, C/O QUEST DIAGNOSTICS, SECAUCUS NJ 07094
Olumide Soroye officer: President & CEO of IOS 6920 SEAWAY BLVD., EVERETT WA 98203
Edward Read Simmons officer: SVP - Strategy 6920 SEAWAY BLVD, EVERETT WA 98203
Rejji P Hayes director ONE ENERGY PLAZA, JACKSON MI 49201
Sharmistha Dubey director 8750 NORTH CENTRAL EXPRESSWAY SUITE 1400, DALLAS TX 75231
Christopher M. Mulhall officer: VP - Chief Accounting Officer C/O FORTIVE CORPORATION, 6920 SEAWAY BLVD, EVERETT WA 98203
Jeannine P Sargent director C/O VEECO INSTRUMENTS INC., 100 SUNNYSIDE BOULEVARD SUITE B, WOODBURY NY 11797
Barbara B. Hulit officer: Senior Vice President C/O FORTIVE CORPORATION, 6920 SEAWAY BLVD, EVERETT WA 98203
Emily A. Weaver officer: VP-Chief Accounting Officer C/O FORTIVE CORPORATION, 6920 SEAWAY BOULEVARD, EVERETT WA 98203
Charles E Mclaughlin officer: SVP - Chief Financial Officer C/O FORTIVE CORPORATION, 6920 SEAWAY BOULEVARD, EVERETT WA 98203
Patrick K Murphy officer: Senior Vice President C/O FORTIVE CORPORATION, 6920 SEAWAY BOULEVARD, EVERETT WA 98203
Jonathan L Schwarz officer: VP-Corporate Development C/O FORTIVE CORPORATION, 6920 SEAWAY BOULEVARD, EVERETT WA 98203
William W Pringle officer: Senior Vice President C/O FORTIVE CORPORATION, 6920 SEAWAY BOULEVARD, EVERETT WA 98203

Fortive (NYSE:FTV) Headlines

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