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Caterpillar Beneish M-Score

: -2.47 (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 -2.47 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

CAT' s Beneish M-Score Range Over the Past 10 Years
Min: -3.23   Med: -2.6   Max: -0.76
Current: -2.47

During the past 13 years, the highest Beneish M-Score of Caterpillar was -0.76. The lowest was -3.23. And the median was -2.60.


Caterpillar Beneish M-Score Historical Data

The historical data trend for Caterpillar'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.

Caterpillar Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Beneish M-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.78 -2.44 -2.48 -2.67 -2.58

Caterpillar Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
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 -2.63 -2.65 -2.58 -2.42 -2.47

Competitive Comparison

For the Farm & Heavy Construction Machinery subindustry, Caterpillar'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.

   

Caterpillar Beneish M-Score Distribution

For the Farm & Heavy Construction Machinery industry and Industrials sector, Caterpillar's Beneish M-Score distribution charts can be found below:

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



Caterpillar 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 Caterpillar 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 * 0.847+0.528 * 1.0517+0.404 * 1.0315+0.892 * 1.1774+0.115 * 1.0147
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9504+4.679 * -0.0092-0.327 * 1.0348
=-2.47

* 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 (Jun22) TTM:Last Year (Jun21) TTM:
Total Receivables was $17,315 Mil.
Revenue was 14247 + 13589 + 13798 + 12397 = $54,031 Mil.
Gross Profit was 4152 + 3924 + 3692 + 3669 = $15,437 Mil.
Total Current Assets was $41,982 Mil.
Total Assets was $81,107 Mil.
Property, Plant and Equipment(Net PPE) was $11,744 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,289 Mil.
Selling, General, & Admin. Expense(SGA) was $5,533 Mil.
Total Current Liabilities was $28,963 Mil.
Long-Term Debt & Capital Lease Obligation was $26,219 Mil.
Net Income was 1673 + 1537 + 2120 + 1426 = $6,756 Mil.
Non Operating Income was 260 + 253 + 1063 + 225 = $1,801 Mil.
Cash Flow from Operations was 2233 + 313 + 1412 + 1740 = $5,698 Mil.
Total Receivables was $17,363 Mil.
Revenue was 12889 + 11887 + 11235 + 9881 = $45,892 Mil.
Gross Profit was 3892 + 3750 + 3323 + 2825 = $13,790 Mil.
Total Current Assets was $42,946 Mil.
Total Assets was $81,697 Mil.
Property, Plant and Equipment(Net PPE) was $12,014 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,383 Mil.
Selling, General, & Admin. Expense(SGA) was $4,945 Mil.
Total Current Liabilities was $27,508 Mil.
Long-Term Debt & Capital Lease Obligation was $26,204 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)
=(17315 / 54031) / (17363 / 45892)
=0.32046418 / 0.37834481
=0.847

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)
=(13790 / 45892) / (15437 / 54031)
=0.3004881 / 0.28570635
=1.0517

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 - (41982 + 11744) / 81107) / (1 - (42946 + 12014) / 81697)
=0.33759108 / 0.32727028
=1.0315

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
=54031 / 45892
=1.1774

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))
=(2383 / (2383 + 12014)) / (2289 / (2289 + 11744))
=0.16552059 / 0.16311551
=1.0147

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)
=(5533 / 54031) / (4945 / 45892)
=0.10240418 / 0.10775299
=0.9504

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)
=((26219 + 28963) / 81107) / ((26204 + 27508) / 81697)
=0.68036051 / 0.65745376
=1.0348

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
=(6756 - 1801 - 5698) / 81107
=-0.0092

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.

Caterpillar has a M-score of -2.47 suggests that the company is unlikely to be a manipulator.


Caterpillar Beneish M-Score Related Terms

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Caterpillar Business Description

Caterpillar logo
Address
510 Lake Cook Road, Suite 100, Deerfield, IL, USA, 60015
Caterpillar is an iconic manufacturer of heavy equipment, power solutions, and locomotives. It is currently the world's largest manufacturer of heavy equipment with over 13% market share in 2021. The company is divided into four reportable segments: construction industries, resource industries, energy and transportation, and Caterpillar Financial Services. Its products are available through a dealer network that covers the globe with over 2,000 branches maintained by 168 dealers. Caterpillar Financial Services provides retail financing for machinery and engines to its customers, in addition to wholesale financing for dealers, which increases the likelihood of Caterpillar product sales.
Executives
Schaupp William E officer: Chief Accounting Officer PPG INDUSTRIES, INC. ONE PPG PLACE PITTSBURGH PA 15272
Maclennan David director 14701 CHARLSON ROAD EDEN PRAIRIE MN 55347
Johnson Gerald director 300 RENAISSANCE CENTER M/C: 482-C23-A68 DETROIT MI 48265
Fassino Anthony D. officer: Group President 510 LAKE COOK ROAD SUITE 100 DEERFIELD IL 60015
Marvel Gary Michael officer: Chief Accounting Officer 510 LAKE COOK ROAD SUITE 100 DEERFIELD IL 60015
Ainsworth William P officer: Group President 510 LAKE COOK ROAD SUITE 100 DEERFIELD X1 60015
Bonfield Andrew R J officer: Chief Financial Officer C/O BRISTOL MYERS SQUIBB CO 345 PARK AVE NEW YORK NY 10164
Younessi Ramin officer: Group President 510 LAKE COOK ROAD SUITE 100 DEERFIELD IL 60015
Creed Joseph E officer: Interim CFO 510 LAKE COOK ROAD SUITE 100 DEERFIELD IL 60015
Ayotte Kelly director C/O NEWS CORPORATION 1211 AVENUE OF THE AMERICAS NEW YORK NY 10036
Johnson Cheryl H officer: Chief Human Resources Officer 40 WESTMINSTER STREET PROVIDENCE RI 02903
Wilkins Rayford Jr director 208 S. AKARD ST. -- DALLAS TX 75202
Long Suzette M officer: Int. Executive Vice President 510 LAKE COOK ROAD SUITE 100 DEERFILED IL 60015
De Lange Bob officer: Group President 510 LAKE COOK ROAD SUITE 100 DEERFIELD IL 60015
Johnson Denise C officer: Group President C/O CATERPILLAR, INCORPORATED 901 WEST WASHINGTON, CV41110 EAST PEORIA IL 61630

Caterpillar Headlines

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