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Colony Capital Inc (NYSE:CLNY)
Beneish M-Score
-1.90 (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.

Colony Capital Inc has a M-score of -1.90 signals that the company is a manipulator.

CLNY' s 10-Year Beneish M-Score Range
Min: -2.71   Max: -1.9
Current: -1.9

-2.71
-1.9

During the past 6 years, the highest Beneish M-Score of Colony Capital Inc was -1.90. The lowest was -2.71. 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 Colony Capital 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 * 1+0.528 * 1+0.404 * 0.6276+0.892 * 2.0537+0.115 * 1.0298
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.5988+4.679 * -0.0099-0.327 * 1.2069
=-1.90

* 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 $4,045.6 Mil.
Revenue was 220.904 + 116.612 + 85.597 + 77.282 = $500.4 Mil.
Gross Profit was 220.904 + 116.612 + 85.597 + 77.282 = $500.4 Mil.
Total Current Assets was $4,241.6 Mil.
Total Assets was $9,860.1 Mil.
Property, Plant and Equipment(Net PPE) was $3,090.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $67.6 Mil.
Selling, General & Admin. Expense(SGA) was $187.9 Mil.
Total Current Liabilities was $960.3 Mil.
Long-Term Debt was $3,273.6 Mil.
Net Income was 59.316 + 10.529 + 24.816 + 38.954 = $133.6 Mil.
Non Operating Income was 40.271 + -0.286 + -0.022 + 0.037 = $40.0 Mil.
Cash Flow from Operations was 70.075 + 57.921 + 33.158 + 30.255 = $191.4 Mil.
Accounts Receivable was $0.0 Mil.
Revenue was 78.563 + 59.207 + 58.42 + 47.47 = $243.7 Mil.
Gross Profit was 78.563 + 59.207 + 58.42 + 47.47 = $243.7 Mil.
Total Current Assets was $2,094.4 Mil.
Total Assets was $3,751.7 Mil.
Property, Plant and Equipment(Net PPE) was $124.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $2.8 Mil.
Selling, General & Admin. Expense(SGA) was $57.2 Mil.
Total Current Liabilities was $331.6 Mil.
Long-Term Debt was $1,003.2 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)
=(4045.627 / 500.395) / (0 / 243.66)
=8.08486696 / 0
=1

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)
=(116.612 / 243.66) / (220.904 / 500.395)
=1 / 1
=1

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 - (4241.616 + 3090.612) / 9860.06) / (1 - (2094.352 + 124.832) / 3751.696)
=0.25637085 / 0.40848512
=0.6276

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
=500.395 / 243.66
=2.0537

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))
=(2.815 / (2.815 + 124.832)) / (67.636 / (67.636 + 3090.612))
=0.02205301 / 0.02141567
=1.0298

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)
=(187.947 / 500.395) / (57.241 / 243.66)
=0.37559728 / 0.23492161
=1.5988

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)
=((3273.571 + 960.328) / 9860.06) / ((1003.217 + 331.588) / 3751.696)
=0.42939891 / 0.35578709
=1.2069

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
=(133.615 - 40 - 191.409) / 9860.06
=-0.0099

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.

Colony Capital Inc has a M-score of -1.90 signals that the company is likely to 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.

Colony Capital Inc Annual Data

Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.242
GMI 1
AQI 0.6059
SGI 1.6681
DEPI 0.4952
SGAI 1.336
LVGI 1.9491
TATA -0.0018
M-score -2.26

Colony Capital Inc Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.2420.82081
GMI 111
AQI 0.60590.74920.6276
SGI 1.66811.73932.0537
DEPI 0.49520.84251.0298
SGAI 1.3361.35011.5988
LVGI 1.94911.95531.2069
TATA -0.0018-0.0074-0.0099
M-score -2.26-2.51-1.90
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