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Barnes & Noble Inc (NYSE:BKS)
Beneish M-Score
-2.95 (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.

Barnes & Noble Inc has a M-score of -2.95 suggests that the company is not a manipulator.

BKS' s Beneish M-Score Range Over the Past 10 Years
Min: -3.38   Max: -0.46
Current: -2.95

-3.38
-0.46

During the past 13 years, the highest Beneish M-Score of Barnes & Noble Inc was -0.46. The lowest was -3.38. And the median was -2.73.


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 Barnes & Noble Inc 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 * 0.7523+0.528 * 1.0811+0.404 * 0.8151+0.892 * 1.2581+0.115 * 0.8488
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9093+4.679 * -0.0863-0.327 * 1.1194
=-2.95

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Jan16) TTM:Last Year (Jan15) TTM:
Accounts Receivable was $69 Mil.
Revenue was 1413.947 + 894.654 + 1217.542 + 2682.468 = $6,209 Mil.
Gross Profit was 491.655 + 269.786 + 352.385 + 746.382 = $1,860 Mil.
Total Current Assets was $1,361 Mil.
Total Assets was $2,206 Mil.
Property, Plant and Equipment(Net PPE) was $307 Mil.
Depreciation, Depletion and Amortization(DDA) was $192 Mil.
Selling, General & Admin. Expense(SGA) was $1,606 Mil.
Total Current Liabilities was $1,296 Mil.
Long-Term Debt was $0 Mil.
Net Income was 80.262 + -39.226 + -34.874 + -19.421 = $-13 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 288.735 + -52.922 + 10.239 + -68.975 = $177 Mil.
Accounts Receivable was $73 Mil.
Revenue was 1440.132 + 936.544 + 1236.447 + 1321.906 = $4,935 Mil.
Gross Profit was 505.784 + 285.731 + 382.692 + 424.351 = $1,599 Mil.
Total Current Assets was $2,368 Mil.
Total Assets was $3,876 Mil.
Property, Plant and Equipment(Net PPE) was $349 Mil.
Depreciation, Depletion and Amortization(DDA) was $170 Mil.
Selling, General & Admin. Expense(SGA) was $1,404 Mil.
Total Current Liabilities was $2,034 Mil.
Long-Term Debt was $0 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)
=(69.364 / 6208.611) / (73.286 / 4935.029)
=0.01117223 / 0.01485017
=0.7523

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)
=(269.786 / 4935.029) / (491.655 / 6208.611)
=0.32392069 / 0.29961742
=1.0811

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 - (1361.341 + 307.179) / 2206.42) / (1 - (2367.598 + 349.329) / 3876.243)
=0.24378858 / 0.29908238
=0.8151

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
=6208.611 / 4935.029
=1.2581

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))
=(169.519 / (169.519 + 349.329)) / (192.252 / (192.252 + 307.179))
=0.32672189 / 0.38494206
=0.8488

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)
=(1605.78 / 6208.611) / (1403.635 / 4935.029)
=0.25863756 / 0.28442285
=0.9093

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)
=((0 + 1296.187) / 2206.42) / ((0 + 2034.2) / 3876.243)
=0.58746159 / 0.5247865
=1.1194

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
=(-13.259 - 0 - 177.077) / 2206.42
=-0.0863

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.

Barnes & Noble Inc has a M-score of -2.95 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 own currency.

Barnes & Noble Inc Annual Data

Jan06Jan07Jan08Jan09Apr10Apr11Apr12Apr13Apr14Apr15
DSRI 1.03450.98311.08590.76270.50871.44891.10080.79340.8370.8485
GMI 0.99350.98631.02680.98231.06931.12170.95691.09330.8450.9437
AQI 0.99550.92690.96521.06272.10871.00460.95280.97221.02241.0795
SGI 1.04711.0311.02840.94661.13391.2051.01870.95930.93310.9511
DEPI 1.04721.01391.00970.98970.83770.81050.93210.97210.91131.0148
SGAI 1.02811.03121.00911.05970.97350.96881.04791.0041.02791.011
LVGI 1.00730.97741.05011.00731.08671.06311.05660.79821.01350.9208
TATA -0.1119-0.0378-0.0919-0.1027-0.0254-0.0745-0.0108-0.0737-0.1038-0.006
M-score -2.94-2.68-2.82-3.22-2.49-2.20-2.50-2.95-3.27-2.66

Barnes & Noble Inc Quarterly Data

Oct13Jan14Apr14Jul14Oct14Jan15Apr15Jul15Oct15Jan16
DSRI 0.90250.82060.8370.8520.47320.31710.8180.83140.9480.7523
GMI 1.11141.01840.8450.81770.79610.81090.95440.98871.02761.0811
AQI 1.05930.99811.02241.01991.13911.15041.07951.01270.73010.8151
SGI 0.91720.91280.93310.93650.83640.77880.98660.99821.13551.2581
DEPI 1.00640.97970.91130.92790.85060.91031.01481.01330.90880.8488
SGAI 1.01150.98121.02791.02911.10781.16331.02471.03180.95610.9093
LVGI 0.9681.00281.01350.950.92390.95140.92081.00131.22881.1194
TATA -0.0654-0.1169-0.1038-0.0445-0.01390.0062-0.006-0.0479-0.0593-0.0863
M-score -2.86-3.26-3.27-2.97-3.24-3.34-2.66-2.87-2.86-2.95
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