Methode Electronics, Inc. — Earnings Quality Grade F
MEI · Technology
Major red flags
Screening Summary
Management Signals
Financial Trends
Revenue & Net Income ($B)
Margins (%)
18-Point Screening
Revenue Quality
DSO 84 days, change -2 days YoY
AR growth -8.2% vs revenue growth -6.0%
Revenue -6.0%, CFFO -44.4%. Cash follows revenue
Expense Quality
Inventory 4.2% vs COGS -5.5%. Normal
CapEx growth -17.1% vs revenue -6.0%. Normal
SG&A/Gross Profit = 100.3%, exceeds 70%
Gross margin 15.6%, change -0.5pp. Stable
Cash Flow Quality
CFFO/NI = -0.42. Below 1.0
FCF is negative ($-0.0B)
Accruals ratio = -6.8%. Low accruals
Cash $0.1B covers only 30% of debt $0.3B
Balance Sheet Health
Goodwill+Intangibles $0.4B = 59% of equity. Over 50%
Debt/EBITDA = 11.3x (>4x). Interest coverage = -1.1x (<2x). Financial stress
Other assets -21.3% vs revenue -6.0%. Normal
No write-off data
Acquisition Risk
FCF after acquisitions negative for 3 years
Small-cap context: A single acquisition on a small balance sheet can trip serial-acquirer logic.
Goodwill+Intangibles change -4% YoY. Normal
Manipulation Score
M-Score = -2.88 (< -2.22). Unlikely manipulator
Portfolio monitoring
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Beneish M-Score
Altman Z-Score
Generated from public financial data using forensic accounting frameworks. Not investment advice. Data: Yahoo Finance · 2026-04-25