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GuruFocus has detected 4 Warning Signs with Nutraceutical International Corp $NUTR.
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Nutraceutical International Corp (NAS:NUTR)
Beneish M-Score
-2.57 (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.

Nutraceutical International Corp has a M-score of -2.57 suggests that the company is not a manipulator.

NUTR' s Beneish M-Score Range Over the Past 10 Years
Min: -6.22   Max: -2.29
Current: -2.57

-6.22
-2.29

During the past 13 years, the highest Beneish M-Score of Nutraceutical International Corp was -2.29. The lowest was -6.22. And the median was -2.72.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (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 Nutraceutical International Corp 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 * 1.017+0.528 * 0.9821+0.404 * 0.9285+0.892 * 1.0532+0.115 * 0.9282
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0332+4.679 * -0.0345-0.327 * 0.8228
=-2.57

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

This Year (Mar17) TTM:Last Year (Mar16) TTM:
Accounts Receivable was $20.6 Mil.
Revenue was 61.215 + 56.619 + 56.701 + 60.836 = $235.4 Mil.
Gross Profit was 31.075 + 28.94 + 28.192 + 31.42 = $119.6 Mil.
Total Current Assets was $97.0 Mil.
Total Assets was $236.6 Mil.
Property, Plant and Equipment(Net PPE) was $82.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $14.3 Mil.
Selling, General & Admin. Expense(SGA) was $87.1 Mil.
Total Current Liabilities was $20.1 Mil.
Long-Term Debt was $36.5 Mil.
Net Income was 4.462 + 4.201 + 3.77 + 6.029 = $18.5 Mil.
Non Operating Income was -0.624 + 0 + 0 + 0 = $-0.6 Mil.
Cash Flow from Operations was 6.91 + 4.872 + 9.318 + 6.155 = $27.3 Mil.
Accounts Receivable was $19.3 Mil.
Revenue was 59.492 + 55.959 + 53.649 + 54.382 = $223.5 Mil.
Gross Profit was 30.329 + 28.108 + 26.687 + 26.427 = $111.6 Mil.
Total Current Assets was $89.8 Mil.
Total Assets was $234.5 Mil.
Property, Plant and Equipment(Net PPE) was $83.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $13.3 Mil.
Selling, General & Admin. Expense(SGA) was $80.0 Mil.
Total Current Liabilities was $20.7 Mil.
Long-Term Debt was $47.5 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in 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)
=(20.648 / 235.371) / (19.277 / 223.482)
=0.08772534 / 0.08625751
=1.017

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)
=(111.551 / 223.482) / (119.627 / 235.371)
=0.49914982 / 0.50824868
=0.9821

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 plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (96.993 + 82.242) / 236.605) / (1 - (89.814 + 83.46) / 234.515)
=0.24247163 / 0.26113895
=0.9285

4. SGI = Sales Growth Index

Ratio of sales 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
=235.371 / 223.482
=1.0532

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation 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))
=(13.278 / (13.278 + 83.46)) / (14.272 / (14.272 + 82.242))
=0.13725733 / 0.14787492
=0.9282

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses 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)
=(87.09 / 235.371) / (80.034 / 223.482)
=0.3700116 / 0.3581228
=1.0332

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)
=((36.5 + 20.127) / 236.605) / ((47.5 + 20.712) / 234.515)
=0.23933138 / 0.29086412
=0.8228

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
=(18.462 - -0.624 - 27.255) / 236.605
=-0.0345

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.

Nutraceutical International Corp has a M-score of -2.57 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

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

Nutraceutical International Corp Annual Data

Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15Sep16
DSRI 1.04470.97170.99150.83361.22690.93310.9691.07251.10080.9779
GMI 0.9730.99731.03641.00691.02981.01461.01050.9961.01010.9685
AQI 1.32320.87890.62431.11930.94071.03890.94051.12740.95041.0927
SGI 1.04081.0660.97281.10911.04451.06541.04011.02921.00931.0763
DEPI 1.15031.08620.94430.99891.06210.96420.91530.90050.89540.9665
SGAI 1.07381.01490.95460.9520.99470.98260.97481.03150.99571.0216
LVGI 1.74771.06220.9361.06821.03160.97570.96011.06710.81281.1022
TATA -0.0737-0.0364-0.2881-0.0025-0.0619-0.0613-0.0508-0.0161-0.046-0.0571
M-score -2.87-2.68-3.97-2.51-2.53-2.74-2.72-2.45-2.56-2.72

Nutraceutical International Corp Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 1.14781.09070.95381.10081.19911.10971.3580.97790.91911.017
GMI 1.01491.01521.01521.01010.99360.98260.96660.96850.97180.9821
AQI 1.05931.04060.96240.95041.09211.09571.0751.09270.92980.9285
SGI 1.02741.03851.00931.00931.01591.03221.06811.07631.0651.0532
DEPI 0.87530.84770.85410.89540.91751.0030.99850.96650.96750.9282
SGAI 1.03471.02161.01620.99570.98690.98960.99911.02161.0331.0332
LVGI 0.99940.95240.81750.81281.0221.08091.15071.10220.8850.8228
TATA -0.0082-0.026-0.0463-0.046-0.0559-0.0591-0.0356-0.0571-0.0485-0.0345
M-score -2.35-2.47-2.70-2.56-2.52-2.62-2.29-2.72-2.74-2.57
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