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Ball Corp (NYSE:BLL)
Beneish M-Score
-2.86 (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.

Ball Corp has a M-score of -2.86 suggests that the company is not a manipulator.

BLL' s 10-Year Beneish M-Score Range
Min: -3.2   Max: -1.74
Current: -2.86

-3.2
-1.74

During the past 13 years, the highest Beneish M-Score of Ball Corp was -1.74. The lowest was -3.20. And the median was -2.68.


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 Ball Corp 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 * 0.9867+0.528 * 1.0029+0.404 * 0.9394+0.892 * 1.0003+0.115 * 1.0753
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3286+4.679 * -0.0624-0.327 * 1.0134
=-2.86

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $901 Mil.
Revenue was 1923.1 + 2032.4 + 2238.9 + 2291.9 = $8,486 Mil.
Gross Profit was 362.2 + 395.5 + 431.6 + 445.5 = $1,635 Mil.
Total Current Assets was $2,468 Mil.
Total Assets was $7,661 Mil.
Property, Plant and Equipment(Net PPE) was $2,424 Mil.
Depreciation, Depletion and Amortization(DDA) was $280 Mil.
Selling, General & Admin. Expense(SGA) was $599 Mil.
Total Current Liabilities was $2,039 Mil.
Long-Term Debt was $3,152 Mil.
Net Income was 20.7 + 76 + 147.4 + 153.1 = $397 Mil.
Non Operating Income was -59.9 + -33.1 + 0 + 0 = $-93 Mil.
Cash Flow from Operations was -180.5 + 362.5 + 440 + 346.2 = $968 Mil.
Accounts Receivable was $913 Mil.
Revenue was 2006.8 + 1996.8 + 2277.9 + 2202.4 = $8,484 Mil.
Gross Profit was 393.9 + 410.7 + 431 + 403.5 = $1,639 Mil.
Total Current Assets was $2,404 Mil.
Total Assets was $7,745 Mil.
Property, Plant and Equipment(Net PPE) was $2,360 Mil.
Depreciation, Depletion and Amortization(DDA) was $296 Mil.
Selling, General & Admin. Expense(SGA) was $451 Mil.
Total Current Liabilities was $1,821 Mil.
Long-Term Debt was $3,358 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)
=(901.2 / 8486.3) / (913.1 / 8483.9)
=0.10619469 / 0.10762739
=0.9867

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)
=(395.5 / 8483.9) / (362.2 / 8486.3)
=0.19320124 / 0.1926399
=1.0029

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 - (2467.9 + 2423.6) / 7660.5) / (1 - (2404.3 + 2360.2) / 7744.5)
=0.36146466 / 0.38478921
=0.9394

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
=8486.3 / 8483.9
=1.0003

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))
=(296.2 / (296.2 + 2360.2)) / (280.4 / (280.4 + 2423.6))
=0.11150429 / 0.10369822
=1.0753

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)
=(598.7 / 8486.3) / (450.5 / 8483.9)
=0.070549 / 0.05310058
=1.3286

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)
=((3152.1 + 2039.3) / 7660.5) / ((3357.7 + 1821.3) / 7744.5)
=0.67768422 / 0.66873265
=1.0134

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
=(397.2 - -93 - 968.2) / 7660.5
=-0.0624

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.

Ball Corp has a M-score of -2.86 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.

Ball Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.02721.33650.9010.73071.38341.39710.87461.01620.95320.9808
GMI 1.1351.01011.03720.97470.90870.98551.00431.00440.95050.9672
AQI 0.94291.05410.98460.98761.03960.97411.01331.02290.98860.9808
SGI 1.05721.15131.1161.02320.88741.1371.13121.01210.96941.012
DEPI 1.02051.01640.93850.92021.12741.06210.96091.08050.98481.0834
SGAI 0.82281.06691.00990.87011.20821.01550.9450.99861.3311.0866
LVGI 1.07341.04980.96241.01560.91841.03011.05991.01691.02811.0108
TATA -0.0649-0.0277-0.0672-0.0507-0.0265-0.0055-0.0692-0.0579-0.0517-0.0673
M-score -2.65-2.16-2.77-2.95-2.38-2.04-2.81-2.71-2.89-2.84

Ball Corp Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 1.01620.9440.92590.89950.95320.96050.95120.9190.98080.9867
GMI 1.00440.98310.96330.9640.95050.92640.92150.92610.96721.0029
AQI 1.02290.99751.00981.04390.98861.04631.03290.99210.98080.9394
SGI 1.01211.00250.99320.98990.96940.9770.99810.9941.0121.0003
DEPI 1.08051.04651.02381.03290.98480.99561.03941.03631.08341.0753
SGAI 0.99861.0711.08511.26551.20981.16681.15120.98941.17671.3286
LVGI 1.01691.01251.0281.02221.02811.01010.97941.02121.01081.0134
TATA -0.0579-0.0463-0.0413-0.0657-0.0483-0.066-0.0757-0.0654-0.0629-0.0624
M-score -2.71-2.77-2.78-2.94-2.85-2.90-2.92-2.91-2.83-2.86
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