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Graco Beneish M-Score

: -2.23 (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 -2.23 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

GGG' s Beneish M-Score Range Over the Past 10 Years
Min: -3.84   Med: -2.54   Max: -1.95
Current: -2.23

During the past 13 years, the highest Beneish M-Score of Graco was -1.95. The lowest was -3.84. And the median was -2.54.


Graco Beneish M-Score Historical Data

The historical data trend for Graco'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.

Graco 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 -2.52 -2.56 -2.58 -2.37 -2.48

Graco 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 -2.22 -2.52 -2.48 -2.25 -2.23

Competitive Comparison

For the Specialty Industrial Machinery subindustry, Graco'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.

   

Graco Beneish M-Score Distribution

For the Industrial Products industry and Industrials sector, Graco's Beneish M-Score distribution charts can be found below:

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



Graco 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 Graco 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 * 0.9525+0.528 * 1.041+0.404 * 0.8996+0.892 * 1.1059+0.115 * 1.1965
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9862+4.679 * 0.035-0.327 * 0.896
=-2.23

* 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 $373 Mil.
Revenue was 548.547 + 494.285 + 539.619 + 486.696 = $2,069 Mil.
Gross Profit was 269.06 + 254.475 + 274.557 + 248.234 = $1,046 Mil.
Total Current Assets was $1,276 Mil.
Total Assets was $2,404 Mil.
Property, Plant and Equipment(Net PPE) was $547 Mil.
Depreciation, Depletion and Amortization(DDA) was $61 Mil.
Selling, General, & Admin. Expense(SGA) was $422 Mil.
Total Current Liabilities was $424 Mil.
Long-Term Debt & Capital Lease Obligation was $98 Mil.
Net Income was 117.378 + 100.843 + 120.232 + 103.829 = $442 Mil.
Non Operating Income was -0.607 + -0.153 + -12.612 + -0.344 = $-14 Mil.
Cash Flow from Operations was 103.66 + 31.325 + 99.665 + 137.184 = $372 Mil.
Total Receivables was $354 Mil.
Revenue was 507.164 + 454.129 + 470.34 + 439.316 = $1,871 Mil.
Gross Profit was 263.824 + 247.334 + 244.824 + 228.953 = $985 Mil.
Total Current Assets was $1,204 Mil.
Total Assets was $2,229 Mil.
Property, Plant and Equipment(Net PPE) was $427 Mil.
Depreciation, Depletion and Amortization(DDA) was $58 Mil.
Selling, General, & Admin. Expense(SGA) was $387 Mil.
Total Current Liabilities was $359 Mil.
Long-Term Debt & Capital Lease Obligation was $182 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)
=(373.141 / 2069.147) / (354.222 / 1870.949)
=0.18033566 / 0.18932745
=0.9525

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)
=(984.935 / 1870.949) / (1046.326 / 2069.147)
=0.52643605 / 0.50567988
=1.041

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 - (1276.476 + 547.211) / 2404.278) / (1 - (1203.952 + 426.837) / 2229.205)
=0.24148247 / 0.26844368
=0.8996

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
=2069.147 / 1870.949
=1.1059

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))
=(58.175 / (58.175 + 426.837)) / (60.966 / (60.966 + 547.211))
=0.11994549 / 0.10024384
=1.1965

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)
=(422.37 / 2069.147) / (387.264 / 1870.949)
=0.20412759 / 0.206988
=0.9862

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)
=((98.112 + 424.058) / 2404.278) / ((181.639 + 358.724) / 2229.205)
=0.2171837 / 0.24240166
=0.896

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
=(442.282 - -13.716 - 371.834) / 2404.278
=0.035

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.

Graco has a M-score of -2.23 suggests that the company is unlikely to be a manipulator.


Graco Business Description

Graco logo
Traded in Other Exchanges
Address
88-11th Avenue Northeast, Minneapolis, MN, USA, 55413
Graco manufactures equipment used for managing fluids, coatings, and adhesives, specializing in difficult-to-handle materials. Graco's business is organized into three segments: industrial, process, and contractor. The Minnesota-based firm serves a wide range of end markets, including industrial, automotive, and construction, and its broad array of products include pumps, valves, meters, sprayers, and equipment used to apply coatings, sealants, and adhesives. The firm generated roughly $2 billion in sales and $531 million in operating income in 2021.
Executives
Grasdal Inge officer: EVP, Corporate Development 88 11TH AVENUE NE MINNEAPOLIS MN 55413
Gargano Anthony J officer: President, Asia Pacific 88 11TH AVENUE NE MINNEAPOLIS MN 55413
Humke Joseph J officer: Executive Vice President 88 11TH AVENUE NE MINNEAPOLIS MN 55413
Carter Brett C director 414 NICOLLET MALL, 401-9 MINNEAPOLIS MN 55401
Schoenrock Kathryn L officer: Executive Vice President 88 11TH AVENUE NE MINNEAPOLIS MN 55413
Wheeler Kevin J. director A. O. SMITH CORPORATION 500 TENNESSEE WALTZ PARKWAY ASHLAND CITY TN 37015
Wordell Angela F officer: Executive VP, Operations 88 11TH AVENUE NE MINNEAPOLIS MN 55413
White Timothy R officer: President, EMEA 88 11TH AVENUE NE MINNEAPOLIS MN 55413
White Emily director C/O LULULEMON ATHLETICA INC. 1818 CORNWALL AVENUE VANCOUVER A1 V6J 1C7
Feragen Jody H director 1 HORMEL PLACE AUSTIN TX 55912
O'shea Peter J officer: Vice President 88 - 11TH AVENUE N.E. MINNEAPOLIS MN 55413
Eberlein Mark D officer: Vice President 88 - 11TH AVENUE N.E. MINNEAPOLIS MN 55413
Moreau Bernard J officer: Vice President 88 - 11TH AVENUE N.E. MINNEAPOLIS MN 55413
Rothe Christian E officer: Vice President and Treasurer 88 - 11TH AVENUE N.E. MINNEAPOLIS MN 55413
Etchart Eric director ROOM F, 22F CROSS REGION PLAZA 899 LINGLING ROAD SHANGHAI F4 200030

Graco Headlines

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