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Barnes & Noble Inc (NYSE:BKS)
Beneish M-Score
-3.56 (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 -3.56 suggests that the company is not a manipulator.

BKS' s Beneish M-Score Range Over the Past 10 Years
Min: -3.56   Max: -0.46
Current: -3.56

-3.56
-0.46

During the past 13 years, the highest Beneish M-Score of Barnes & Noble Inc was -0.46. The lowest was -3.56. 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 * 0.3492+0.528 * 0.9487+0.404 * 0.8961+0.892 * 0.7588+0.115 * 0.9357
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1121+4.679 * -0.0288-0.327 * 1.1194
=-3.56

* 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 + 1184.079 = $4,710 Mil.
Gross Profit was 491.655 + 269.786 + 352.385 + 401.882 = $1,516 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 $155 Mil.
Selling, General & Admin. Expense(SGA) was $1,341 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 + -195.845 = $50 Mil.
Accounts Receivable was $262 Mil.
Revenue was 1961.151 + 1687.82 + 1236.447 + 1321.906 = $6,207 Mil.
Gross Profit was 628.037 + 459.888 + 382.692 + 424.351 = $1,895 Mil.
Total Current Assets was $2,368 Mil.
Total Assets was $3,876 Mil.
Property, Plant and Equipment(Net PPE) was $454 Mil.
Depreciation, Depletion and Amortization(DDA) was $207 Mil.
Selling, General & Admin. Expense(SGA) was $1,589 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 / 4710.222) / (261.763 / 6207.324)
=0.01472627 / 0.04217002
=0.3492

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)
=(1894.968 / 6207.324) / (1515.708 / 4710.222)
=0.30527938 / 0.3217912
=0.9487

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 + 454.063) / 3876.243)
=0.24378858 / 0.27206292
=0.8961

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
=4710.222 / 6207.324
=0.7588

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))
=(207.153 / (207.153 + 454.063)) / (154.618 / (154.618 + 307.179))
=0.31329097 / 0.33481811
=0.9357

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)
=(1340.99 / 4710.222) / (1589.017 / 6207.324)
=0.28469783 / 0.25599067
=1.1121

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 - 50.207) / 2206.42
=-0.0288

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 -3.56 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 1.03450.98311.08590.76270.50851.44961.10080.79340.8370.8485
GMI 0.99170.9881.02680.98231.06981.12650.95581.08950.8450.9437
AQI 0.99550.92690.96521.06272.10871.00460.95520.96971.02241.0795
SGI 1.04711.0311.02840.94661.13451.20451.01870.95930.93310.9511
DEPI 1.04721.01391.00970.98970.83770.81050.93210.97210.91131.0148
SGAI 1.03061.02871.00911.05970.97310.96931.04791.0041.02791.011
LVGI 1.00730.97741.05011.00731.08671.06311.00350.90010.94630.9208
TATA -0.1119-0.0378-0.0919-0.1027-0.0247-0.0759-0.0119-0.0737-0.1038-0.006
M-score -2.94-2.68-2.82-3.22-2.49-2.21-2.48-2.99-3.25-2.66

Barnes & Noble Inc Quarterly Data

Oct13Jan14Apr14Jul14Oct14Jan15Apr15Jul15Oct15Jan16
DSRI 0.93850.83910.8370.8520.86220.90040.84850.86250.6170.3492
GMI 1.1031.00590.8450.81860.82270.86440.94370.9780.95360.9487
AQI 1.04420.98341.02241.01991.03841.04651.07951.01270.8010.8961
SGI 0.91720.91280.93310.93650.95080.97960.95110.96220.84230.7588
DEPI 1.00640.97970.91130.92790.9260.94931.01481.01330.91260.9357
SGAI 1.01150.98121.02791.02911.03591.0471.0111.01821.08291.1121
LVGI 0.9851.02090.94631.00910.9230.95140.92081.00131.231.1194
TATA -0.0658-0.1167-0.1038-0.0445-0.0569-0.0265-0.006-0.04790.0082-0.0288
M-score -2.84-3.26-3.25-2.99-2.98-2.76-2.66-2.87-3.14-3.56
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