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GuruFocus has detected 3 Warning Signs with Tutor Perini Corp $TPC.
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Tutor Perini Corp (NYSE:TPC)
Beneish M-Score
-2.58 (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.

Tutor Perini Corp has a M-score of -2.58 suggests that the company is not a manipulator.

TPC' s Beneish M-Score Range Over the Past 10 Years
Min: -3.96   Max: 11.91
Current: -2.58

-3.96
11.91

During the past 13 years, the highest Beneish M-Score of Tutor Perini Corp was 11.91. The lowest was -3.96. And the median was -2.32.


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 Tutor Perini 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 * 1.0687+0.528 * 0.8256+0.404 * 0.8484+0.892 * 1.0133+0.115 * 0.5545
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0306+4.679 * 0.0057-0.327 * 0.9742
=-2.58

* 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 $1,750 Mil.
Revenue was 1117.361 + 1246.599 + 1332.978 + 1308.13 = $5,005 Mil.
Gross Profit was 102.72 + 117.66 + 124.668 + 109.77 = $455 Mil.
Total Current Assets was $2,814 Mil.
Total Assets was $3,998 Mil.
Property, Plant and Equipment(Net PPE) was $463 Mil.
Depreciation, Depletion and Amortization(DDA) was $75 Mil.
Selling, General & Admin. Expense(SGA) was $256 Mil.
Total Current Liabilities was $1,395 Mil.
Long-Term Debt was $753 Mil.
Net Income was 13.764 + 30.261 + 28.801 + 21.361 = $94 Mil.
Non Operating Income was 0.417 + 1.763 + 2.048 + 2.485 = $7 Mil.
Cash Flow from Operations was -32.845 + 19.17 + 89.59 + -11.368 = $65 Mil.
Accounts Receivable was $1,616 Mil.
Revenue was 1085.369 + 1200.83 + 1340.739 + 1312.438 = $4,939 Mil.
Gross Profit was 105.092 + 66.673 + 100.201 + 98.62 = $371 Mil.
Total Current Assets was $2,732 Mil.
Total Assets was $4,131 Mil.
Property, Plant and Equipment(Net PPE) was $520 Mil.
Depreciation, Depletion and Amortization(DDA) was $44 Mil.
Selling, General & Admin. Expense(SGA) was $245 Mil.
Total Current Liabilities was $1,552 Mil.
Long-Term Debt was $726 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)
=(1749.602 / 5005.068) / (1615.661 / 4939.376)
=0.34956608 / 0.3270982
=1.0687

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)
=(370.586 / 4939.376) / (454.818 / 5005.068)
=0.07502689 / 0.09087149
=0.8256

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 - (2813.819 + 462.695) / 3998.483) / (1 - (2732.297 + 519.89) / 4131.482)
=0.18056073 / 0.21282799
=0.8484

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
=5005.068 / 4939.376
=1.0133

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))
=(43.849 / (43.849 + 519.89)) / (75.489 / (75.489 + 462.695))
=0.07778245 / 0.14026615
=0.5545

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)
=(256.003 / 5005.068) / (245.135 / 4939.376)
=0.05114876 / 0.04962874
=1.0306

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)
=((753.191 + 1394.772) / 3998.483) / ((725.763 + 1552.422) / 4131.482)
=0.53719448 / 0.55142077
=0.9742

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
=(94.187 - 6.713 - 64.547) / 3998.483
=0.0057

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.

Tutor Perini Corp has a M-score of -2.58 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.

Tutor Perini Corp Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.75691.15960.86771.3031.24640.86811.03821.0650.90931.1705
GMI 1.03520.91340.78160.71320.99271.05360.9030.99381.5540.7876
AQI 0.694713.77681.11951.01311.05320.77590.95150.85580.92120.9488
SGI 1.52111.2230.91020.6211.16161.10631.01561.07581.09531.0107
DEPI 1.02951.32730.77951.24940.90050.78591.05521.15351.2540.5965
SGAI 0.72011.01531.44721.51031.18031.03690.99490.93190.86831.0069
LVGI 0.98090.75470.87080.97581.14931.04030.97741.0060.99320.9627
TATA -0.1208-0.06860.05740.02890.0314-0.05940.01620.04580.0046-0.0061
M-score -2.852.78-2.54-2.60-2.04-2.89-2.41-2.17-2.14-2.51

Tutor Perini Corp Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 1.0650.99190.9220.87520.90931.08011.09611.10691.17051.0687
GMI 0.99381.06951.24831.37821.5541.42121.23071.03350.78760.8256
AQI 0.85580.89350.9280.98780.92121.03991.09911.08310.94880.8484
SGI 1.07581.11251.15881.12111.09531.0731.02141.00121.01071.0133
DEPI 1.15351.20651.3841.37661.2541.11320.82530.70290.59650.5545
SGAI 0.93190.9260.90930.88190.86830.84440.85090.90791.00691.0306
LVGI 1.0060.98171.00140.96930.99320.97760.93150.93910.96270.9742
TATA 0.04580.0320.0268-0.0130.00460.0021-0.0005-0.0062-0.00610.0057
M-score -2.17-2.20-2.12-2.28-2.14-2.05-2.19-2.36-2.51-2.58
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