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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.
Warning Sign:
Beneish M-Score -0.68 higher than -1.78, which implies that the company might have manipulated its financial results.
The historical rank and industry rank for Steel Connect's Beneish M-Score or its related term are showing as below:
During the past 13 years, the highest Beneish M-Score of Steel Connect was 10.62. The lowest was -3.68. And the median was -2.91.
The historical data trend for Steel Connect'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.
Steel Connect Annual Data | |||||||||||||||||||||
Trend | Jul14 | Jul15 | Jul16 | Jul17 | Jul18 | Jul19 | Jul20 | Jul21 | Jul22 | Jul23 | |||||||||||
Beneish M-Score | Get a 7-Day Free Trial | -3.05 | -3.15 | -3.07 | -2.84 | 2.35 |
Steel Connect Quarterly Data | ||||||||||||||||||||
Apr19 | Jul19 | Oct19 | Jan20 | Apr20 | Jul20 | Oct20 | Jan21 | Apr21 | Jul21 | Oct21 | Jan22 | Apr22 | Jul22 | Oct22 | Jan23 | Apr23 | Jul23 | Oct23 | Jan24 | |
Beneish M-Score | Get a 7-Day Free Trial | -3.19 | -3.12 | 2.35 | -0.83 | -0.68 |
For the Advertising Agencies subindustry, Steel Connect'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.
For the Media - Diversified industry and Communication Services sector, Steel Connect's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where Steel Connect's Beneish M-Score falls into.
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 Steel Connect 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 * 0.947 | + | 0.528 * 0.8598 | + | 0.404 * 5.9002 | + | 0.892 * 0.8287 | + | 0.115 * 0.4084 | |
- | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI | |||||||
- | 0.172 * 1.1234 | + | 4.679 * -0.010319 | - | 0.327 * 0.2881 | |||||||
= | -0.68 |
* 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 (Jan24) TTM: | Last Year (Jan23) TTM: |
Total Receivables was $29.2 Mil. Revenue was 43.045 + 41.341 + 40.804 + 46.142 = $171.3 Mil. Gross Profit was 11.347 + 11.475 + 11.055 + 12.924 = $46.8 Mil. Total Current Assets was $321.4 Mil. Total Assets was $412.7 Mil. Property, Plant and Equipment(Net PPE) was $29.2 Mil. Depreciation, Depletion and Amortization(DDA) was $4.5 Mil. Selling, General, & Admin. Expense(SGA) was $38.7 Mil. Total Current Liabilities was $75.6 Mil. Long-Term Debt & Capital Lease Obligation was $16.1 Mil. Net Income was 5.346 + 4.436 + 8.149 + 3.029 = $21.0 Mil. Non Operating Income was 0.568 + 0.33 + 5.688 + 4.037 = $10.6 Mil. Cash Flow from Operations was 0.078 + 6.583 + 8.523 + -0.588 = $14.6 Mil. |
Total Receivables was $37.2 Mil. Revenue was 50.781 + 51.359 + 53.049 + 51.548 = $206.7 Mil. Gross Profit was 13.062 + 14.265 + 11.985 + 9.245 = $48.6 Mil. Total Current Assets was $118.1 Mil. Total Assets was $156.1 Mil. Property, Plant and Equipment(Net PPE) was $34.0 Mil. Depreciation, Depletion and Amortization(DDA) was $2.0 Mil. Selling, General, & Admin. Expense(SGA) was $41.5 Mil. Total Current Liabilities was $85.5 Mil. Long-Term Debt & Capital Lease Obligation was $35.0 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) |
= | (29.179 / 171.332) | / | (37.18 / 206.737) | |
= | 0.170307 | / | 0.179842 | |
= | 0.947 |
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) | |
= | (48.557 / 206.737) | / | (46.801 / 171.332) | |
= | 0.234873 | / | 0.27316 | |
= | 0.8598 |
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 - (321.372 + 29.246) / 412.715) | / | (1 - (118.1 + 34.031) / 156.112) | |
= | 0.15046 | / | 0.025501 | |
= | 5.9002 |
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 | |
= | 171.332 | / | 206.737 | |
= | 0.8287 |
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)) |
= | (1.969 / (1.969 + 34.031)) | / | (4.523 / (4.523 + 29.246)) | |
= | 0.054694 | / | 0.133939 | |
= | 0.4084 |
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) |
= | (38.669 / 171.332) | / | (41.533 / 206.737) | |
= | 0.225696 | / | 0.200898 | |
= | 1.1234 |
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) |
= | ((16.135 + 75.617) / 412.715) | / | ((35.008 + 85.456) / 156.112) | |
= | 0.222313 | / | 0.771651 | |
= | 0.2881 |
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 | |
= | (20.96 - 10.623 | - | 14.596) | / | 412.715 | |
= | -0.010319 |
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.
Steel Connect has a M-score of -0.68 signals that the company is likely to be a manipulator.
Thank you for viewing the detailed overview of Steel Connect's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.
Steel Partners Holdings L.p. | other: See Explanation of Responses | 590 MADISON AVENUE, 32ND FLOOR, NEW YORK NY 10022 |
Joseph Richards Martin | director | C/O LOUISIANA-PACIFIC CORPORATION, 414 UNION STREET, SUITE 2000, NASHVILLE TN 37219 |
Ryan O'herrin | officer: Chief Financial Officer | 590 MADISON AVENUE, 32ND FLOOR, NEW YORK NY 10022-8547 |
Webfinancial Holding Corp | director, 10 percent owner | 590 MADISON AVENUE, 32ND FLOOR, NEW YORK NY 10022 |
Wf Asset Corp. | 10 percent owner | 590 MADISON AVENUE, 32ND FLOOR, NEW YORK NY 10022 |
Gary Tankard | officer: Chief Accounting Officer | C/O STEEL PARTNERS HOLDINGS LP, 590 MADISON AVENUE, 32ND FLOOR, NEW YORK NY 10022 |
Jason Wong | officer: Chief Financial Officer | 590 MADISON AVENUE, FLOOR 32, C/O STEEL PARTNERS HOLDINGS LP, NEW YORK NY 10022 |
Renata Simril | director | 5055 WILSHIRE BOULEVARD, SUITE 500, LOS ANGELES CA 90036 |
Fawaz Khalil | officer: CEO, ModusLink Corporation | C/O STEEL CONNECT, INC., 1601 TRAPELO ROAD, SUITE 170, WALTHAM MA 02451 |
John Ashe | officer: CEO,IWCO Direct Holdings, Inc. | C/O STEEL CONNECT, INC., 1601 TRAPELO ROAD, SUITE 170, WALTHAM MA 02451 |
Maria Molland | director | 1601 TRAPELO ROAD, SUITE 170, WALTHAM MA 02451 |
Joseph B Sherk | officer: Chief Accounting Officer | C/O UNITED RENTALS INC, FIVE GREENWICH OFFICE PARK, GREENWICH CT 06830 |
Douglas Woodworth | officer: Chief Financial Officer | STEEL PARTNERS HOLDINGS L.P., 590 MADISON AVENUE, 32ND FLOOR, NEW YORK NY 10022 |
Steel Excel Inc. | 10 percent owner | 590 MADISON AVENUE, 32ND FLOOR, NEW YORK NY 10022 |
Philip E. Lengyel | director | C/O MODUSLINK GLOBAL SOLUTIONS, INC., 1601 TRAPELO ROAD, SUITE 170, WALTHAM MA 02451 |
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