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Carnival Corp (NYSE:CCL)
Beneish M-Score
-3.10 (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.

Carnival Corp has a M-score of -3.10 suggests that the company is not a manipulator.

CCL' s 10-Year Beneish M-Score Range
Min: -3.24   Max: 6.99
Current: -3.1

-3.24
6.99

During the past 13 years, the highest Beneish M-Score of Carnival Corp was 6.99. The lowest was -3.24. And the median was -2.58.


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 Carnival 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 * 0.6017+0.528 * 0.9063+0.404 * 1.0133+0.892 * 1.0276+0.115 * 0.9694
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0627+4.679 * -0.0488-0.327 * 0.9783
=-3.10

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

This Year (Nov14) TTM:Last Year (Nov13) TTM:
Accounts Receivable was $486 Mil.
Revenue was 3718 + 4947 + 3633 + 3585 = $15,883 Mil.
Gross Profit was 1221 + 2193 + 1068 + 997 = $5,479 Mil.
Total Current Assets was $1,503 Mil.
Total Assets was $39,532 Mil.
Property, Plant and Equipment(Net PPE) was $32,773 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,634 Mil.
Selling, General & Admin. Expense(SGA) was $2,053 Mil.
Total Current Liabilities was $6,921 Mil.
Long-Term Debt was $7,363 Mil.
Net Income was -102 + 1247 + 106 + -15 = $1,236 Mil.
Non Operating Income was -288 + 16 + 22 + -16 = $-266 Mil.
Cash Flow from Operations was 637 + 1120 + 1196 + 477 = $3,430 Mil.
Accounts Receivable was $786 Mil.
Revenue was 3658 + 4726 + 3479 + 3593 = $15,456 Mil.
Gross Profit was 1037 + 1809 + 992 + 994 = $4,832 Mil.
Total Current Assets was $1,937 Mil.
Total Assets was $40,104 Mil.
Property, Plant and Equipment(Net PPE) was $32,905 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,588 Mil.
Selling, General & Admin. Expense(SGA) was $1,880 Mil.
Total Current Liabilities was $6,720 Mil.
Long-Term Debt was $8,092 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)
=(486 / 15883) / (786 / 15456)
=0.03059875 / 0.05085404
=0.6017

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)
=(2193 / 15456) / (1221 / 15883)
=0.3126294 / 0.34496002
=0.9063

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 - (1503 + 32773) / 39532) / (1 - (1937 + 32905) / 40104)
=0.13295558 / 0.13120886
=1.0133

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
=15883 / 15456
=1.0276

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))
=(1588 / (1588 + 32905)) / (1634 / (1634 + 32773))
=0.04603833 / 0.04749034
=0.9694

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)
=(2053 / 15883) / (1880 / 15456)
=0.1292577 / 0.12163561
=1.0627

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)
=((7363 + 6921) / 39532) / ((8092 + 6720) / 40104)
=0.36132753 / 0.36933972
=0.9783

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
=(1236 - -266 - 3430) / 39532
=-0.0488

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.

Carnival Corp has a M-score of -3.10 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.

Carnival Corp Annual Data

Nov05Nov06Nov07Nov08Nov09Nov10Nov11Nov12Nov13Nov14
DSRI 0.92180.61021.41450.85310.94230.63730.97161.0542.89720.6017
GMI 0.99881.03081.02811.08331.01981.01021.06831.05711.05260.906
AQI 0.94250.96240.97570.97320.93310.95220.96880.97390.98761.0133
SGI 1.14051.06721.10091.12380.9191.0751.09150.9741.00481.0277
DEPI 0.92431.00471.01830.88041.07380.96010.96460.99930.98530.9689
SGAI 0.91091.01570.99130.9181.06210.94430.97461.02851.08721.0637
LVGI 0.93931.00091.03081.01910.94350.96170.99791.0110.99690.9783
TATA -0.0404-0.0441-0.0486-0.0326-0.0426-0.049-0.0483-0.0431-0.0445-0.0487
M-score -2.61-2.99-2.24-2.63-2.80-2.97-2.63-2.64-0.93-3.10

Carnival Corp Quarterly Data

Aug12Nov12Feb13May13Aug13Nov13Feb14May14Aug14Nov14
DSRI 0.87211.05411.44981.47691.46282.89720.64270.69380.7770.6017
GMI 1.06051.05721.00031.00761.06211.05261.07271.05660.93710.9063
AQI 0.98290.97390.97750.98970.98480.98760.99021.02691.02161.0133
SGI 0.9940.97390.96470.96590.99191.00481.00361.01751.02911.0276
DEPI 0.95370.99931.0020.9930.980.98530.99910.98970.98650.9694
SGAI 0.99431.0281.0621.07711.07411.08781.09951.10391.0961.0627
LVGI 0.99821.0111.00021.00281.03930.99690.98770.94790.92680.9783
TATA -0.0457-0.0431-0.0397-0.0413-0.0437-0.0445-0.0482-0.0483-0.048-0.0488
M-score -2.80-2.64-2.30-2.28-2.27-0.93-3.01-2.93-2.90-3.10
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