Cleveland-Cliffs (MIL:1CVA) Beneish M-Score : -2.64 (As of Dec. 11, 2024)

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What is Cleveland-Cliffs 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 -2.64 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

MIL:1CVA' s Beneish M-Score Range Over the Past 10 Years
Min: -16.71 Med: -1.93 Max: 3.55
Current: -2.64

During the past 13 years, the highest Beneish M-Score of Cleveland-Cliffs was 3.55. The lowest was -16.71. And the median was -1.93.

Cleveland-Cliffs Beneish M-Score Historical Data

The historical data trend for Cleveland-Cliffs'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.

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Cleveland-Cliffs Beneish M-Score Chart

Cleveland-Cliffs Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-3.29

3.55

-0.91

-2.26

-2.71

Cleveland-Cliffs Quarterly Data
	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
Beneish M-Score	Get a 7-Day Free Trial															-1.93	-2.71	-3.28	-3.30	-2.64

Competitive Comparison of Cleveland-Cliffs's Beneish M-Score

For the Steel subindustry, Cleveland-Cliffs'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.

Cleveland-Cliffs's Beneish M-Score Distribution in the Steel Industry

For the Steel industry and Basic Materials sector, Cleveland-Cliffs's Beneish M-Score distribution charts can be found below:

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

Cleveland-Cliffs 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 Cleveland-Cliffs 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 * 0.8021

0.528 * 2.0419

0.404 * 0.9814

0.892 * 0.8943

0.115 * 1.0196

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0601

4.679 * -0.09373

0.327 * 1.1193

-2.70

This Year (Sep24) TTM:

Last Year (Sep23) TTM:

Total Receivables was €1,426 Mil.
Revenue was 4116.669 + 4730.468 + 4783.08 + 4687.704 = €18,318 Mil.
Gross Profit was -93.704 + 150.498 + 262.2 + 154.056 = €473 Mil.
Total Current Assets was €5,430 Mil.
Total Assets was €15,133 Mil.
Property, Plant and Equipment(Net PPE) was €7,827 Mil.
Depreciation, Depletion and Amortization(DDA) was €851 Mil.
Selling, General, & Admin. Expense(SGA) was €467 Mil.
Total Current Liabilities was €2,933 Mil.
Long-Term Debt & Capital Lease Obligation was €3,400 Mil.
Net Income was -218.042 + 1.858 + -61.64 + -142.135 = €-420 Mil.
Non Operating Income was 35.139 + 15.793 + -116.84 + -70.609 = €-137 Mil.
Cash Flow from Operations was -75.684 + 482.151 + 130.64 + 597.884 = €1,135 Mil.

Total Receivables was €1,988 Mil.
Revenue was 5251.885 + 5523.232 + 4945.53 + 4761.536 = €20,482 Mil.
Gross Profit was 449.76 + 594.412 + 92.466 + -56.64 = €1,080 Mil.
Total Current Assets was €6,504 Mil.
Total Assets was €16,921 Mil.
Property, Plant and Equipment(Net PPE) was €8,280 Mil.
Depreciation, Depletion and Amortization(DDA) was €920 Mil.
Selling, General, & Admin. Expense(SGA) was €492 Mil.
Total Current Liabilities was €3,086 Mil.
Long-Term Debt & Capital Lease Obligation was €3,240 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)
	=	(1426.283 / 18317.921)	/	(1988.314 / 20482.183)
	=	0.077863	/	0.097075
	=	0.8021

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)
	=	(1079.998 / 20482.183)	/	(473.05 / 18317.921)
	=	0.052729	/	0.025824
	=	2.0419

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 - (5430.327 + 7826.987) / 15133.196)	/	(1 - (6503.717 + 8280.269) / 16921.283)
	=	0.123958	/	0.126308
	=	0.9814

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
	=	18317.921	/	20482.183
	=	0.8943

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))
	=	(919.546 / (919.546 + 8280.269))	/	(850.642 / (850.642 + 7826.987))
	=	0.099953	/	0.098027
	=	1.0196

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)
	=	(466.593 / 18317.921)	/	(492.116 / 20482.183)
	=	0.025472	/	0.024027
	=	1.0601

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)
	=	((3400.374 + 2932.755) / 15133.196)	/	((3240.146 + 3086.478) / 16921.283)
	=	0.418492	/	0.373886
	=	1.1193

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
	=	(-419.959 - -136.517	-	1134.991)	/	15133.196
	=	-0.09373

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.

Cleveland-Cliffs has a M-score of -2.70 suggests that the company is unlikely to be a manipulator.

Cleveland-Cliffs Beneish M-Score Related Terms

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Cleveland-Cliffs Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Basic Materials » Steel » Cleveland-Cliffs Inc (MIL:1CVA) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

CLF:USA CLF:Mexico 0I0H:UK CVA:Germany CVA:Germany

Address

200 Public Square, Suite 3300, Cleveland, OH, USA, 44114-2315

Website

https://www.clevelandcliffs.com

Cleveland-Cliffs Inc is a flat-rolled steel producer and manufacturer of iron ore pellets in North America. It is organized into four operating segments based on differentiated products, Steelmaking, Tubular, Tooling and Stamping and European Operations, but operates through one reportable segment -Steelmaking. It is vertically integrated from mined raw materials, direct reduced iron, and ferrous scrap to primary steelmaking and downstream finishing, stamping, tooling and tubing. It serves a diverse range of other markets due to its comprehensive offering of flat-rolled steel products. Geographically, it operates in the United States, Canada and other countries. The majority of revenue is from the United States. It is a supplier of steel to the automotive industry in North America.

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