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Colony Capital Inc (NYSE:CLNY)
Beneish M-Score
-2.29 (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 -2.29 suggests that the company is not a manipulator.

CLNY' s 10-Year Beneish M-Score Range
Min: -2.71   Max: -2.29
Current: -2.29

-2.71
-2.29

During the past 6 years, the highest Beneish M-Score of Colony Capital Inc was -2.29. The lowest was -2.71. And the median was -2.50.


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 * 1.2963+0.528 * 1+0.404 * 0.6059+0.892 * 1.5982+0.115 * 0.4952
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3944+4.679 * -0.004-0.327 * 1.9491
=-2.29

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $2,131.1 Mil.
Revenue was 85.597 + 77.282 + 65.973 + 59.207 = $288.1 Mil.
Gross Profit was 85.597 + 77.282 + 65.973 + 59.207 = $288.1 Mil.
Total Current Assets was $2,273.1 Mil.
Total Assets was $5,871.8 Mil.
Property, Plant and Equipment(Net PPE) was $1,644.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $9.2 Mil.
Selling, General & Admin. Expense(SGA) was $87.0 Mil.
Total Current Liabilities was $351.9 Mil.
Long-Term Debt was $2,584.2 Mil.
Net Income was 24.816 + 38.954 + 37.649 + 21.73 = $123.1 Mil.
Non Operating Income was -0.022 + 0.037 + 12.811 + 0.98 = $13.8 Mil.
Cash Flow from Operations was 33.158 + 30.255 + 36.03 + 33.316 = $132.8 Mil.
Accounts Receivable was $1,028.7 Mil.
Revenue was 58.42 + 47.47 + 40.764 + 33.585 = $180.2 Mil.
Gross Profit was 58.42 + 47.47 + 40.764 + 33.585 = $180.2 Mil.
Total Current Assets was $1,071.8 Mil.
Total Assets was $2,628.6 Mil.
Property, Plant and Equipment(Net PPE) was $112.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.3 Mil.
Selling, General & Admin. Expense(SGA) was $39.0 Mil.
Total Current Liabilities was $196.7 Mil.
Long-Term Debt was $477.6 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)
=(2131.134 / 288.059) / (1028.654 / 180.239)
=7.39825522 / 5.7071666
=1.2963

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)
=(77.282 / 180.239) / (85.597 / 288.059)
=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 - (2273.07 + 1643.997) / 5871.848) / (1 - (1071.821 + 112.468) / 2628.552)
=0.33290729 / 0.54945194
=0.6059

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
=288.059 / 180.239
=1.5982

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))
=(0.31 / (0.31 + 112.468)) / (9.177 / (9.177 + 1643.997))
=0.00274876 / 0.00555114
=0.4952

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)
=(87.011 / 288.059) / (39.043 / 180.239)
=0.30205965 / 0.21661794
=1.3944

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)
=((2584.163 + 351.892) / 5871.848) / ((477.607 + 196.718) / 2628.552)
=0.50002231 / 0.25653858
=1.9491

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
=(123.149 - 13.806 - 132.759) / 5871.848
=-0.004

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 -2.29 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.

Colony Capital Inc Annual Data

Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.2666
GMI 1
AQI 0.6059
SGI 1.6357
DEPI 0.4952
SGAI 1.3624
LVGI 1.9491
TATA -0.0018
M-score -2.27

Colony Capital Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.2963
GMI 1
AQI 0.6059
SGI 1.5982
DEPI 0.4952
SGAI 1.3944
LVGI 1.9491
TATA -0.004
M-score -2.29
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