GURUFOCUS.COM » STOCK LIST » USA » NYSE » Ecolab Inc (NYSE:ECL) » Definitions » Beneish M-Score
Switch to:

Ecolab Beneish M-Score

: -2.42 (As of Today)
View and export this data going back to 1986. Start your Free Trial

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 -2.42 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

ECL' s Beneish M-Score Range Over the Past 10 Years
Min: -4.3   Med: -2.69   Max: -1.4
Current: -2.42

During the past 13 years, the highest Beneish M-Score of Ecolab was -1.40. The lowest was -4.30. And the median was -2.69.


Ecolab Beneish M-Score Historical Data

The historical data trend for Ecolab'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.

Ecolab 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 -2.53 -2.61 -2.73 -3.33 -2.53

Ecolab 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 -2.59 -2.65 -2.53 -2.49 -2.42

Competitive Comparison

For the Specialty Chemicals subindustry, Ecolab'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.

   

Ecolab Beneish M-Score Distribution

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

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



Ecolab 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 Ecolab 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 * 1.0152+0.528 * 1.0805+0.404 * 1.1516+0.892 * 1.1155+0.115 * 0.9931
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9574+4.679 * -0.0287-0.327 * 1.0891
=-2.42

* 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 $2,827 Mil.
Revenue was 3580.6 + 3266.7 + 3364.6 + 3320.8 = $13,533 Mil.
Gross Profit was 1369.5 + 1193.3 + 1321.5 + 1304.1 = $5,188 Mil.
Total Current Assets was $4,905 Mil.
Total Assets was $21,164 Mil.
Property, Plant and Equipment(Net PPE) was $3,665 Mil.
Depreciation, Depletion and Amortization(DDA) was $892 Mil.
Selling, General, & Admin. Expense(SGA) was $3,555 Mil.
Total Current Liabilities was $3,806 Mil.
Long-Term Debt & Capital Lease Obligation was $8,460 Mil.
Net Income was 308.3 + 171.9 + 301 + 324.5 = $1,106 Mil.
Non Operating Income was 15.9 + -5.3 + -59.5 + 6.7 = $-42 Mil.
Cash Flow from Operations was 322.4 + 170.1 + 640.9 + 622.7 = $1,756 Mil.
Total Receivables was $2,496 Mil.
Revenue was 3162.7 + 2885 + 3065.3 + 3018.6 = $12,132 Mil.
Gross Profit was 1318.7 + 1173 + 1285 + 1249 = $5,026 Mil.
Total Current Assets was $5,487 Mil.
Total Assets was $18,534 Mil.
Property, Plant and Equipment(Net PPE) was $3,469 Mil.
Depreciation, Depletion and Amortization(DDA) was $837 Mil.
Selling, General, & Admin. Expense(SGA) was $3,328 Mil.
Total Current Liabilities was $2,880 Mil.
Long-Term Debt & Capital Lease Obligation was $6,983 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)
=(2826.7 / 13532.7) / (2496.1 / 12131.6)
=0.20887923 / 0.20575192
=1.0152

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)
=(5025.7 / 12131.6) / (5188.4 / 13532.7)
=0.41426522 / 0.38339725
=1.0805

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 - (4905 + 3664.8) / 21163.6) / (1 - (5487.4 + 3469.4) / 18533.7)
=0.59506889 / 0.51672899
=1.1516

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
=13532.7 / 12131.6
=1.1155

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))
=(837.1 / (837.1 + 3469.4)) / (891.9 / (891.9 + 3664.8))
=0.19438059 / 0.19573375
=0.9931

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)
=(3554.7 / 13532.7) / (3328.4 / 12131.6)
=0.26267485 / 0.27435788
=0.9574

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)
=((8459.6 + 3806) / 21163.6) / ((6982.7 + 2880.3) / 18533.7)
=0.57956113 / 0.53216573
=1.0891

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
=(1105.7 - -42.2 - 1756.1) / 21163.6
=-0.0287

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.

Ecolab has a M-score of -2.42 suggests that the company is unlikely to be a manipulator.


Ecolab Business Description

Ecolab logo
Address
1 Ecolab Place, Saint Paul, MN, USA, 55102
Ecolab produces and markets cleaning and sanitation products for the hospitality, healthcare, and industrial markets. The firm is the global market share leader in this category with a wide array of products and services, including dish and laundry washing systems, pest control, and infection control products. The company has a strong hold on the U.S. market and is looking to increase its profitability abroad. Additionally, Ecolab serves customers in water, manufacturing, and life sciences end markets, selling customized solutions.
Executives
Sved Gergely officer: EVP & PRES - HC & LIFE SCI 1 ECOLAB PLACE ST. PAUL MN 55102
Bradway Jennifer J officer: SVP & CORPORATE CONTROLLER 1 ECOLAB PLACE ST. PAUL MN 55102
De Boo Alexander A. officer: EVP & PRES - GLOBAL MARKETS 1 ECOLAB PLACE SAINT PAUL MN 55102
Peterson Gail officer: SVP - Global Mktg & Comms 1 ECOLAB PLACE SAINT PAUL MN 55102
Charton Jerome officer: EVP - Global Regions 1 ECOLAB PLACE SAINT PAUL MN 55102
Duijser Machiel officer: EVP & CSCO 1 ECOLAB PLACE ST. PAUL MN 55102
Zillmer John J director ARAMARK CORP 1101 MARKET ST PHILADELPHIA PA 19107
Biller Leslie S director 10877 WILSHIRE BLVD 17TH FLOOR LOS ANGELES CA 90024
Mckibben Tracy B director 100 RIVERSIDE BOULEVARD #3S NEW YORK NY 10069
Reich Victoria director UNITED STATIONERS SUPPLY CO ONE PARKWAY NORTH BLVD SUITE 100 LAKE FOREST IL 60045
Ettinger Jeffrey M director 1 HORMEL PLACE AUSTINE MN 55912
Beck Barbara director 5301 N IRONWOOD RD MILWAUKEE WI 53217
Higgins Arthur J director C/O ZIMMER, INC. P.O. BOX 708 WARSAW IN 46580
Larson Michael director 2365 CARILLON POINT KIRKLAND WA 98033
Maclennan David director 14701 CHARLSON ROAD EDEN PRAIRIE MN 55347

Ecolab Headlines

Other Sources

Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)