Switch to:
Barnes & Noble Inc (NYSE:BKS)
Beneish M-Score
-2.99 (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 -2.99 suggests that the company is not a manipulator.

BKS' s 10-Year Beneish M-Score Range
Min: -3.38   Max: -0.46
Current: -2.99

-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 -2.71.


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 * 0.8622+0.528 * 0.8208+0.404 * 1.0384+0.892 * 0.9508+0.115 * 0.926
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0359+4.679 * -0.0569-0.327 * 0.923
=-2.99

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

This Year (Oct14) TTM:Last Year (Oct13) TTM:
Accounts Receivable was $158 Mil.
Revenue was 1687.82 + 1236.447 + 1321.906 + 1995.79 = $6,242 Mil.
Gross Profit was 459.888 + 382.692 + 424.351 + 603.441 = $1,870 Mil.
Total Current Assets was $2,304 Mil.
Total Assets was $3,836 Mil.
Property, Plant and Equipment(Net PPE) was $470 Mil.
Depreciation, Depletion and Amortization(DDA) was $214 Mil.
Selling, General & Admin. Expense(SGA) was $1,589 Mil.
Total Current Liabilities was $1,947 Mil.
Long-Term Debt was $64 Mil.
Net Income was 12.298 + -28.449 + -36.704 + 63.23 = $10 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 193.629 + -139.032 + -129.66 + 303.832 = $229 Mil.
Accounts Receivable was $193 Mil.
Revenue was 1734.159 + 1329.502 + 1277.021 + 2223.945 = $6,565 Mil.
Gross Profit was 461.942 + 368.201 + 230.9 + 553.512 = $1,615 Mil.
Total Current Assets was $2,437 Mil.
Total Assets was $4,078 Mil.
Property, Plant and Equipment(Net PPE) was $555 Mil.
Depreciation, Depletion and Amortization(DDA) was $226 Mil.
Selling, General & Admin. Expense(SGA) was $1,613 Mil.
Total Current Liabilities was $2,211 Mil.
Long-Term Debt was $105 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)
=(158.483 / 6241.963) / (193.306 / 6564.627)
=0.02538993 / 0.02944661
=0.8622

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)
=(382.692 / 6564.627) / (459.888 / 6241.963)
=0.24594771 / 0.29964484
=0.8208

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 - (2304.023 + 470.31) / 3835.753) / (1 - (2436.729 + 554.804) / 4078.418)
=0.27671751 / 0.26649672
=1.0384

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
=6241.963 / 6564.627
=0.9508

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))
=(225.817 / (225.817 + 554.804)) / (213.682 / (213.682 + 470.31))
=0.28927866 / 0.31240424
=0.926

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)
=(1588.723 / 6241.963) / (1612.993 / 6564.627)
=0.25452298 / 0.24570977
=1.0359

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)
=((64 + 1946.799) / 3835.753) / ((105 + 2211.271) / 4078.418)
=0.52422536 / 0.56793369
=0.923

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
=(10.375 - 0 - 228.769) / 3835.753
=-0.0569

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 -2.99 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

Jan05Jan06Jan07Jan08Jan09Apr10Apr11Apr12Apr13Apr14
DSRI 1.61061.03450.98311.08590.76270.50871.44891.10080.79340.837
GMI 0.98330.99350.98631.02680.98231.06931.12170.95691.09330.845
AQI 0.73940.99550.92690.96521.06272.10871.00460.95280.97221.0224
SGI 1.11471.04711.0311.02840.94661.13391.2051.01870.95930.9331
DEPI 0.93521.04721.01391.00970.98970.83770.81050.93210.97210.9113
SGAI 1.03581.02811.03121.00911.05970.97350.96881.04791.0041.0279
LVGI 1.04151.00730.97741.05011.00731.08671.06311.05660.79821.0135
TATA -0.1242-0.1114-0.0382-0.0941-0.1027-0.0254-0.0745-0.0108-0.0737-0.1038
M-score -2.54-2.93-2.68-2.83-3.22-2.49-2.20-2.50-2.95-3.27

Barnes & Noble Inc Quarterly Data

Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14
DSRI 0.90340.95041.02450.79341.13970.90250.82060.8370.83350.8622
GMI 0.96340.97010.99581.09331.11551.11141.01840.8450.81770.8208
AQI 0.98290.89660.95340.97220.98531.05930.99811.02241.01991.0384
SGI 1.02041.02110.97440.95930.93730.91720.91280.93310.93650.9508
DEPI 0.91610.90850.95290.97210.98981.00640.97970.91130.92790.926
SGAI 1.02741.01951.02651.0041.0081.01150.98121.02791.02911.0359
LVGI 0.97680.97930.92180.79820.90290.9681.00281.01350.950.923
TATA -0.0609-0.0663-0.0377-0.0737-0.0779-0.0654-0.1169-0.1038-0.0445-0.0569
M-score -2.87-2.88-2.66-2.95-2.69-2.86-3.26-3.27-2.98-2.99
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK