Alamo Group Stock Beneish M Score

ALG Stock  USD 199.95  2.06  1.04%   
This module uses fundamental data of Alamo to approximate the value of its Beneish M Score. Alamo M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out Alamo Piotroski F Score and Alamo Altman Z Score analysis.
  
At this time, Alamo's Short Term Debt is most likely to increase significantly in the upcoming years. The Alamo's current Long Term Debt Total is estimated to increase to about 346.5 M, while Short and Long Term Debt is projected to decrease to roughly 8.8 M. At this time, Alamo's Book Value Per Share is most likely to increase significantly in the upcoming years. The Alamo's current Free Cash Flow Yield is estimated to increase to 0.06, while PTB Ratio is projected to decrease to 1.38.
At this time, it appears that Alamo Group is an unlikely manipulator. The earnings manipulation may begin if Alamo's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Alamo executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Alamo's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-2.23
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables

1.0

Focus
Asset Quality

1.0

Focus
Expense Coverage

1.0

Focus
Gross Margin Strengs

0.97

Focus
Accruals Factor

1.0

Focus
Depreciation Resistance

1.0

Focus
Net Sales Growth

1.05

Focus
Financial Leverage Condition

1.0

Focus

Alamo Beneish M-Score Indicator Trends

The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Alamo's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Current ValueLast YearChange From Last Year 10 Year Trend
Net Receivables380.2 M362.1 M
Sufficiently Up
Slightly volatile
Total Revenue1.8 B1.7 B
Sufficiently Up
Slightly volatile
Total Assets1.5 B1.4 B
Sufficiently Up
Slightly volatile
Total Current Assets844.2 M804 M
Sufficiently Up
Slightly volatile
Non Current Assets Total635.7 M605.4 M
Sufficiently Up
Slightly volatile
Property Plant Equipment248.7 M236.9 M
Sufficiently Up
Slightly volatile
Depreciation And Amortization50.4 M48 M
Sufficiently Up
Slightly volatile
Selling General Administrative227.8 M217 M
Sufficiently Up
Slightly volatile
Total Current Liabilities224.6 M213.9 M
Sufficiently Up
Slightly volatile
Non Current Liabilities Total275.8 M262.7 M
Sufficiently Up
Slightly volatile
Short Term Debt21.3 M20.3 M
Sufficiently Up
Slightly volatile
Long Term Debt114.5 M220.3 M
Way Down
Slightly volatile
Operating Income207.9 M198 M
Sufficiently Up
Slightly volatile
Total Cash From Operating Activities137.7 M131.2 M
Sufficiently Up
Slightly volatile
Gross Profit Margin0.260.2685
Sufficiently Down
Very volatile

Alamo Group Beneish M-Score Driver Matrix

One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Alamo's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Alamo in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Alamo's degree of accounting gimmicks and manipulations.

About Alamo Beneish M Score

M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.

Other Operating Expenses

1.57 Billion

At this time, Alamo's Other Operating Expenses is most likely to increase significantly in the upcoming years.

Alamo Earnings Manipulation Drivers

Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Alamo. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
201920202021202220232024 (projected)
Net Receivables237.8M215.5M238.0M317.6M362.1M380.2M
Total Revenue1.1B1.2B1.3B1.5B1.7B1.8B
Total Assets1.2B1.1B1.2B1.3B1.4B1.5B
Total Current Assets570.8M503.0M612.2M727.2M804.0M844.2M
Net Debt401.7M235.2M227.4M254.9M200.0M210.0M
Short Term Debt18.8M18.7M19.7M19.7M20.3M21.3M
Long Term Debt425.1M270.3M254.5M286.9M220.3M114.5M
Operating Income94.6M93.2M116.9M148.6M198.0M207.9M
Investments(429.9M)(14.2M)(33.4M)(31.7M)(30.7M)(32.3M)

Alamo ESG Sustainability

Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Alamo's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Alamo's managers, analysts, and investors.
Environmental
Governance
Social

About Alamo Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Alamo Group's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Alamo using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Alamo Group based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our fundamental analysis page.

Currently Active Assets on Macroaxis

When determining whether Alamo Group is a strong investment it is important to analyze Alamo's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Alamo's future performance. For an informed investment choice regarding Alamo Stock, refer to the following important reports:
Check out Alamo Piotroski F Score and Alamo Altman Z Score analysis.
You can also try the Portfolio Analyzer module to portfolio analysis module that provides access to portfolio diagnostics and optimization engine.
Is Construction Machinery & Heavy Transportation Equipment space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Alamo. If investors know Alamo will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Alamo listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.22)
Dividend Share
1
Earnings Share
9.93
Revenue Per Share
138.895
Quarterly Revenue Growth
(0.04)
The market value of Alamo Group is measured differently than its book value, which is the value of Alamo that is recorded on the company's balance sheet. Investors also form their own opinion of Alamo's value that differs from its market value or its book value, called intrinsic value, which is Alamo's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Alamo's market value can be influenced by many factors that don't directly affect Alamo's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Alamo's value and its price as these two are different measures arrived at by different means. Investors typically determine if Alamo is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Alamo's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.