Switch to:
Ball Corp (NYSE:BLL)
Beneish M-Score
-2.77 (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 -2.77 suggests that the company is not a manipulator.

BLL' s 10-Year Beneish M-Score Range
Min: -3.2   Max: -1.74
Current: -2.77

-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 * 1.0973+0.528 * 1.0341+0.404 * 0.955+0.892 * 0.9759+0.115 * 1.0677
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3506+4.679 * -0.0652-0.327 * 1.0035
=-2.77

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $1,069 Mil.
Revenue was 2172.3 + 1923.1 + 2032.4 + 2238.9 = $8,367 Mil.
Gross Profit was 397.2 + 362.2 + 395.5 + 431.6 = $1,587 Mil.
Total Current Assets was $2,505 Mil.
Total Assets was $7,853 Mil.
Property, Plant and Equipment(Net PPE) was $2,483 Mil.
Depreciation, Depletion and Amortization(DDA) was $282 Mil.
Selling, General & Admin. Expense(SGA) was $605 Mil.
Total Current Liabilities was $2,192 Mil.
Long-Term Debt was $2,982 Mil.
Net Income was 160.4 + 20.7 + 76 + 147.4 = $405 Mil.
Non Operating Income was -5 + -59.9 + -33.1 + 0 = $-98 Mil.
Cash Flow from Operations was 392.2 + -180.5 + 362.5 + 440 = $1,014 Mil.
Accounts Receivable was $998 Mil.
Revenue was 2291.9 + 2006.8 + 1996.8 + 2277.9 = $8,573 Mil.
Gross Profit was 445.5 + 393.9 + 410.7 + 431 = $1,681 Mil.
Total Current Assets was $2,420 Mil.
Total Assets was $7,771 Mil.
Property, Plant and Equipment(Net PPE) was $2,383 Mil.
Depreciation, Depletion and Amortization(DDA) was $291 Mil.
Selling, General & Admin. Expense(SGA) was $459 Mil.
Total Current Liabilities was $1,974 Mil.
Long-Term Debt was $3,129 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)
=(1068.7 / 8366.7) / (998 / 8573.4)
=0.12773256 / 0.11640656
=1.0973

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)
=(362.2 / 8573.4) / (397.2 / 8366.7)
=0.19608323 / 0.18962076
=1.0341

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 - (2505.1 + 2483.4) / 7852.9) / (1 - (2419.8 + 2383.3) / 7771.4)
=0.36475697 / 0.38195177
=0.955

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
=8366.7 / 8573.4
=0.9759

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))
=(291.3 / (291.3 + 2383.3)) / (282.1 / (282.1 + 2483.4))
=0.10891348 / 0.10200687
=1.0677

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)
=(605 / 8366.7) / (459 / 8573.4)
=0.07231047 / 0.05353769
=1.3506

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)
=((2982.1 + 2192.3) / 7852.9) / ((3129.2 + 1973.6) / 7771.4)
=0.65891581 / 0.65661271
=1.0035

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
=(404.5 - -98 - 1014.2) / 7852.9
=-0.0652

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 -2.77 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

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 0.9440.92590.89950.95320.96050.95120.9190.98080.98671.0973
GMI 0.98310.96330.9640.95050.92640.92150.92610.96721.00291.0341
AQI 0.99751.00981.04390.98861.04631.03290.99210.98080.93940.955
SGI 1.00250.99320.98990.96940.9770.99810.9941.0121.00030.9759
DEPI 1.04651.02381.03290.98480.99561.03941.03631.08341.07531.0677
SGAI 1.0711.08511.26551.20981.16681.15120.98941.17671.32861.3506
LVGI 1.01251.0281.02221.02811.01010.97941.02121.01081.01341.0035
TATA -0.0463-0.0413-0.0657-0.0483-0.066-0.0757-0.0654-0.0629-0.0624-0.0652
M-score -2.77-2.78-2.94-2.85-2.90-2.92-2.91-2.83-2.86-2.77
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)

GuruFocus Premium Plus Membership

FEEDBACK