Switch to:
GuruFocus has detected 5 Warning Signs with Valley National Bancorp $VLY.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Valley National Bancorp (NYSE:VLY)
Beneish M-Score
-2.43 (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.

Valley National Bancorp has a M-score of -2.43 suggests that the company is not a manipulator.

VLY' s Beneish M-Score Range Over the Past 10 Years
Min: -36.5   Max: 0.98
Current: -2.43

-36.5
0.98

During the past 13 years, the highest Beneish M-Score of Valley National Bancorp was 0.98. The lowest was -36.50. And the median was -2.53.


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 Valley National Bancorp 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 * 0.957+0.528 * 1+0.404 * 1.0014+0.892 * 1.1324+0.115 * 0.8879
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9448+4.679 * -0.0109-0.327 * 0.9213
=-2.43

* 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 $68.2 Mil.
Revenue was 187.588 + 197.055 + 178.999 + 175.719 = $739.4 Mil.
Gross Profit was 187.588 + 197.055 + 178.999 + 175.719 = $739.4 Mil.
Total Current Assets was $0.0 Mil.
Total Assets was $23,220.5 Mil.
Property, Plant and Equipment(Net PPE) was $289.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $35.3 Mil.
Selling, General & Admin. Expense(SGA) was $269.7 Mil.
Total Current Liabilities was $0.0 Mil.
Long-Term Debt was $1,675.6 Mil.
Net Income was 46.095 + 50.09 + 42.842 + 39.027 = $178.1 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.0 Mil.
Cash Flow from Operations was 65.917 + 271.648 + 48.461 + 44.335 = $430.4 Mil.
Accounts Receivable was $63.0 Mil.
Revenue was 169.601 + 172.084 + 154.879 + 156.377 = $652.9 Mil.
Gross Profit was 169.601 + 172.084 + 154.879 + 156.377 = $652.9 Mil.
Total Current Assets was $0.0 Mil.
Total Assets was $21,727.5 Mil.
Property, Plant and Equipment(Net PPE) was $300.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $32.0 Mil.
Selling, General & Admin. Expense(SGA) was $252.1 Mil.
Total Current Liabilities was $0.0 Mil.
Long-Term Debt was $1,701.7 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)
=(68.245 / 739.361) / (62.973 / 652.941)
=0.09230268 / 0.09644516
=0.957

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)
=(652.941 / 652.941) / (739.361 / 739.361)
=1 / 1
=1

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 - (0 + 289.426) / 23220.456) / (1 - (0 + 300.072) / 21727.523)
=0.98753573 / 0.98618931
=1.0014

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
=739.361 / 652.941
=1.1324

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))
=(32.046 / (32.046 + 300.072)) / (35.288 / (35.288 + 289.426))
=0.0964898 / 0.10867409
=0.8879

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)
=(269.732 / 739.361) / (252.125 / 652.941)
=0.36481773 / 0.38613749
=0.9448

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)
=((1675.625 + 0) / 23220.456) / ((1701.739 + 0) / 21727.523)
=0.07216159 / 0.07832181
=0.9213

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
=(178.054 - 0 - 430.361) / 23220.456
=-0.0109

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.

Valley National Bancorp has a M-score of -2.43 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.

Valley National Bancorp Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.17851.13840.76582.30030.77520.73740.94390.68980.96570.9241
GMI 1111111111
AQI 0.9991.00040.99870.99991.00021.00121.00071.00171.00121.0011
SGI 5.78740.90091.22991.06231.05961.04040.94360.95841.14791.1377
DEPI 0.79851.15671.02250.94370.92380.95830.98150.99751.02360.8402
SGAI 0.17481.21270.93790.97470.96111.07761.04381.01861.01060.9469
LVGI 1.25940.92751.01521.00780.92590.88320.9720.77870.62750.753
TATA -0.0649-0.05720.0008-0.0105-0.0041-0.0112-0.0095-0.0036-0.0024-0.011
M-score 0.76-2.70-2.48-1.28-2.63-2.72-2.63-2.75-2.27-2.41

Valley National Bancorp Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 0.68980.75240.840.82770.96570.85380.86490.8770.92410.957
GMI 1111111111
AQI 1.00171.00181.00221.00151.00121.0011.00081.00171.00111.0014
SGI 0.95840.99741.06791.12281.14791.14891.13031.12291.13771.1324
DEPI 0.99751.01011.02341.02921.02360.98490.93850.86690.84020.8879
SGAI 1.01861.0451.02281.00831.01060.98260.97510.96590.94690.9448
LVGI 0.77870.78040.79530.77390.62750.57830.52640.50790.7530.9213
TATA -0.0036-0.0047-0.0033-0.0019-0.0024-0.0022-0.0018-0.0015-0.011-0.0109
M-score -2.75-2.67-2.52-2.46-2.27-2.35-2.34-2.34-2.41-2.43
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)

GF Chat

{{numOfNotice}}
FEEDBACK