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Marvell Technology Group Ltd  (NAS:MRVL) Beneish M-Score: -2.68 (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.

Marvell Technology Group Ltd has a M-score of -2.68 suggests that the company is not a manipulator.

NAS:MRVL' s Beneish M-Score Range Over the Past 10 Years
Min: -3.89   Max: 14.15
Current: -2.68

-3.89
14.15

During the past 13 years, the highest Beneish M-Score of Marvell Technology Group Ltd was 14.15. The lowest was -3.89. And the median was -2.63.


Historical Data

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

* Premium members only.

Marvell Technology Group Ltd Annual Data

Jan08 Jan09 Jan10 Jan11 Jan12 Jan13 Jan14 Jan15 Jan16 Jan17
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -3.03 -2.32 -2.76 -3.89 -1.94

Marvell Technology Group Ltd Quarterly Data

Oct12 Jan13 Apr13 Jul13 Oct13 Jan14 Apr14 Jul14 Oct14 Jan15 Apr15 Jul15 Oct15 Jan16 Apr16 Jul16 Oct16 Jan17 Apr17 Jul17
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 -1.97 -1.83 -1.94 -2.68 -2.68

Competitive Comparison
* 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.


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 Marvell Technology Group Ltd 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 * 1.0645+0.528 * 0.8602+0.404 * 0.9963+0.892 * 1.0014+0.115 * 0.9751
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8622+4.679 * -0.0479-0.327 * 0.9427
=-2.68

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

This Year (Jul17) TTM:Last Year (Jul16) TTM:
Accounts Receivable was $372 Mil.
Revenue was 604.75 + 579.18 + 496.026 + 654.422 = $2,334 Mil.
Gross Profit was 365.178 + 348.631 + 299.38 + 368.359 = $1,382 Mil.
Total Current Assets was $2,209 Mil.
Total Assets was $4,587 Mil.
Property, Plant and Equipment(Net PPE) was $235 Mil.
Depreciation, Depletion and Amortization(DDA) was $102 Mil.
Selling, General, & Admin. Expense(SGA) was $223 Mil.
Total Current Liabilities was $463 Mil.
Long-Term Debt & Capital Lease Obligation was $0 Mil.
Net Income was 165.259 + 106.621 + -80.091 + 72.616 = $264 Mil.
Non-Recurring Items was 3.438 + -0.128 + 4.192 + 0 = $8 Mil.
Cash Flow from Operations was 101.252 + 135.146 + 118.846 + 121.461 = $477 Mil.
Accounts Receivable was $349 Mil.
Revenue was 597.346 + 519.383 + 539.546 + 674.89 = $2,331 Mil.
Gross Profit was 326.919 + 275.029 + 289.155 + 295.636 = $1,187 Mil.
Total Current Assets was $2,230 Mil.
Total Assets was $4,717 Mil.
Property, Plant and Equipment(Net PPE) was $275 Mil.
(DDA) was $115 Mil.
Selling, General, & Admin. Expense(SGA) was $259 Mil.
Total Current Liabilities was $504 Mil.
Long-Term Debt & Capital Lease Obligation was $0 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Accounts Receivable 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)
=(371.697 / 2334.378) / (348.683 / 2331.165)
=0.15922743 / 0.14957457
=1.0645

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)
=(1186.739 / 2331.165) / (1381.548 / 2334.378)
=0.50907551 / 0.59182703
=0.8602

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 - (2208.946 + 235.354) / 4587.45) / (1 - (2230.279 + 274.774) / 4716.676)
=0.46717675 / 0.46889441
=0.9963

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
=2334.378 / 2331.165
=1.0014

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))
=(114.819 / (114.819 + 274.774)) / (101.942 / (101.942 + 235.354))
=0.29471525 / 0.30223305
=0.9751

6. SGAI = Sales, General and Administrative expenses Index

The ratio of c 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)
=(223.472 / 2334.378) / (258.821 / 2331.165)
=0.09573085 / 0.11102646
=0.8622

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)
=((0 + 462.563) / 4587.45) / ((0 + 504.488) / 4716.676)
=0.10083227 / 0.10695837
=0.9427

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
=(264.405 - 7.502 - 476.705) / 4587.45
=-0.0479

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.

Marvell Technology Group Ltd has a M-score of -2.68 suggests that the company will not be a manipulator.


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