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TT (Trane Technologies) Beneish M-Score : -2.59 (As of Oct. 31, 2024)


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What is Trane Technologies Beneish M-Score?

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 -2.59 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

TT' s Beneish M-Score Range Over the Past 10 Years
Min: -2.94   Med: -2.51   Max: -2.17
Current: -2.59

During the past 13 years, the highest Beneish M-Score of Trane Technologies was -2.17. The lowest was -2.94. And the median was -2.51.


Trane Technologies Beneish M-Score Historical Data

The historical data trend for Trane Technologies'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.

Trane Technologies Beneish M-Score Chart

Trane Technologies Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Beneish M-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only -2.87 -2.56 -2.44 -2.26 -2.52

Trane Technologies Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
Beneish M-Score Get a 7-Day Free Trial 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 -2.45 -2.52 -2.51 -2.59 -

Competitive Comparison of Trane Technologies's Beneish M-Score

For the Building Products & Equipment subindustry, Trane Technologies'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.


Trane Technologies's Beneish M-Score Distribution in the Construction Industry

For the Construction industry and Industrials sector, Trane Technologies's Beneish M-Score distribution charts can be found below:

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



Trane Technologies 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 Trane Technologies 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 * 0.9651+0.528 * 0.9168+0.404 * 0.9392+0.892 * 1.1189+0.115 * 1.0394
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0951+4.679 * -0.031148-0.327 * 1.0215
=-2.64

* 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 (Sep24) TTM:Last Year (Sep23) TTM:
Total Receivables was $3,393 Mil.
Revenue was 5441.2 + 5307.4 + 4215.5 + 4424.1 = $19,388 Mil.
Gross Profit was 1974.4 + 1935.5 + 1459.9 + 1471.3 = $6,841 Mil.
Total Current Assets was $8,100 Mil.
Total Assets was $20,904 Mil.
Property, Plant and Equipment(Net PPE) was $1,907 Mil.
Depreciation, Depletion and Amortization(DDA) was $371 Mil.
Selling, General, & Admin. Expense(SGA) was $3,466 Mil.
Total Current Liabilities was $6,629 Mil.
Long-Term Debt & Capital Lease Obligation was $4,317 Mil.
Net Income was 772 + 755.3 + 436.3 + 504.3 = $2,468 Mil.
Non Operating Income was -9 + -6.8 + -26 + -19.7 = $-62 Mil.
Cash Flow from Operations was 1302.6 + 695.9 + 247.2 + 934.8 = $3,181 Mil.
Total Receivables was $3,143 Mil.
Revenue was 4882.9 + 4704.7 + 3665.8 + 4073.8 = $17,327 Mil.
Gross Profit was 1658.1 + 1584.4 + 1143.5 + 1219.5 = $5,606 Mil.
Total Current Assets was $6,727 Mil.
Total Assets was $18,903 Mil.
Property, Plant and Equipment(Net PPE) was $1,684 Mil.
Depreciation, Depletion and Amortization(DDA) was $343 Mil.
Selling, General, & Admin. Expense(SGA) was $2,829 Mil.
Total Current Liabilities was $5,214 Mil.
Long-Term Debt & Capital Lease Obligation was $4,476 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)
=(3393.4 / 19388.2) / (3142.5 / 17327.2)
=0.175024 / 0.181362
=0.9651

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)
=(5605.5 / 17327.2) / (6841.1 / 19388.2)
=0.323509 / 0.352849
=0.9168

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 - (8099.7 + 1906.6) / 20903.7) / (1 - (6726.9 + 1683.8) / 18903.2)
=0.521314 / 0.555065
=0.9392

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
=19388.2 / 17327.2
=1.1189

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))
=(342.8 / (342.8 + 1683.8)) / (370.6 / (370.6 + 1906.6))
=0.16915 / 0.162744
=1.0394

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)
=(3466.3 / 19388.2) / (2828.8 / 17327.2)
=0.178784 / 0.163258
=1.0951

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)
=((4317.1 + 6628.9) / 20903.7) / ((4476.3 + 5214.2) / 18903.2)
=0.523639 / 0.512638
=1.0215

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
=(2467.9 - -61.5 - 3180.5) / 20903.7
=-0.031148

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.

Trane Technologies has a M-score of -2.64 suggests that the company is unlikely to be a manipulator.


Trane Technologies Beneish M-Score Related Terms

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Trane Technologies Business Description

Address
170/175 Lakeview Drive, Airside Business Park, Swords County, Dublin, IRL
Trane Technologies manufactures and services commercial and residential HVAC systems and transportation refrigeration solutions under its prominent Trane, American Standard, and Thermo King brands. The $18 billion company generates approximately 70% of sales from equipment and 30% from parts and services. While the firm is domiciled in Ireland, North America accounts for over 70% of its revenue.
Executives
Raymond D Pittard officer: Executive Vice President 800-E BEATY STREET, DAVIDSON NC 28036
David S Regnery director, officer: Chair and CEO C/O INTERSOLL-RAND COMPANY, 800-E BEATY STREET, DAVIDSON NC 28036
Evan M Turtz officer: Senior Vice President C/O INGERSOLL-RAND COMPANY, 800-E BEATY STREET, DAVIDSON NC 28036
Paul A Camuti officer: Senior Vice President 800-E BEATY STREET, DAVIDSON NC 28036
Christopher J Kuehn officer: Vice President & Controller 800-E BEATY STREET, DAVIDSON NC 28036
Mairead Magner officer: Senior Vice President 800-E BEATY STREET, DAVIDSON NC 28036
Keith A Sultana officer: Senior Vice President C/O INGERSOLL RAND COMPANY, 800-E BEATY STREET, DAVIDSON NC 28036
Mark Majocha officer: VP & Chief Accounting Officer C/O TRANE TECHNOLOGIES COMPANY LLC, 800-E BEATY STREET, DAVIDSON NC 28036
De Jesus Assis Ana Paula director C/O TRANE TECHNOLOGIES COMPANY LLC, 800-E BEATY STREET, DAVIDSON NC 28036
Linda P Hudson director
John A Hayes director C/O BALL CORP, 10 LONGS PEAK DR, BROOMFIELD CO 80021-2510
Melissa N. Schaeffer director 1940 AIR PRODUCTS BLVD., ALLENTOWN PA 18106
Mark R George director 650 W PEACHTREE ST NW, ATLANTA GA 30308
Marcia J Avedon officer: Senior Vice President C/O INGERSOLL-RAND COMPANY, 800-E BEATY STREET, DAVIDSON NC 28036
Michael W Lamach director, officer: President and CEO C/O INGERSOLL-RAND CO, 800-E BEATY STREET, DAVIDSON NC 28036