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Colony Capital Inc (NYSE:CLNY)
Beneish M-Score
-2.56 (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 -2.56 suggests that the company is not a manipulator.

CLNY' s 10-Year Beneish M-Score Range
Min: -2.71   Max: -2.29
Current: -2.56

-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 -2.71.


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 * 0.8507+0.528 * 1+0.404 * 0.7492+0.892 * 1.6781+0.115 * 0.8425
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.3993+4.679 * -0.0094-0.327 * 1.9553
=-2.56

* 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 $2,146.9 Mil.
Revenue was 116.612 + 85.597 + 77.282 + 65.973 = $345.5 Mil.
Gross Profit was 116.612 + 85.597 + 77.282 + 65.973 = $345.5 Mil.
Total Current Assets was $2,211.2 Mil.
Total Assets was $6,163.9 Mil.
Property, Plant and Equipment(Net PPE) was $1,814.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $30.2 Mil.
Selling, General & Admin. Expense(SGA) was $117.7 Mil.
Total Current Liabilities was $617.8 Mil.
Long-Term Debt was $2,657.9 Mil.
Net Income was 10.529 + 24.816 + 38.954 + 37.649 = $111.9 Mil.
Non Operating Income was -0.286 + -0.022 + 0.037 + 12.811 = $12.5 Mil.
Cash Flow from Operations was 57.921 + 33.158 + 30.255 + 36.03 = $157.4 Mil.
Accounts Receivable was $1,503.9 Mil.
Revenue was 59.207 + 58.42 + 47.47 + 40.764 = $205.9 Mil.
Gross Profit was 59.207 + 58.42 + 47.47 + 40.764 = $205.9 Mil.
Total Current Assets was $1,588.3 Mil.
Total Assets was $3,165.3 Mil.
Property, Plant and Equipment(Net PPE) was $111.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.6 Mil.
Selling, General & Admin. Expense(SGA) was $50.1 Mil.
Total Current Liabilities was $81.0 Mil.
Long-Term Debt was $779.3 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)
=(2146.897 / 345.464) / (1503.864 / 205.861)
=6.21453176 / 7.30523994
=0.8507

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)
=(85.597 / 205.861) / (116.612 / 345.464)
=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 - (2211.193 + 1814.783) / 6163.893) / (1 - (1588.256 + 111.585) / 3165.264)
=0.34684525 / 0.46297023
=0.7492

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
=345.464 / 205.861
=1.6781

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))
=(1.562 / (1.562 + 111.585)) / (30.233 / (30.233 + 1814.783))
=0.01380505 / 0.01638631
=0.8425

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)
=(117.68 / 345.464) / (50.113 / 205.861)
=0.34064331 / 0.24343125
=1.3993

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)
=((2657.949 + 617.775) / 6163.893) / ((779.278 + 81.006) / 3165.264)
=0.53143752 / 0.27178902
=1.9553

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
=(111.948 - 12.54 - 157.364) / 6163.893
=-0.0094

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 -2.56 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

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 1.29630.8507
GMI 11
AQI 0.60590.7492
SGI 1.59821.6781
DEPI 0.49520.8425
SGAI 1.39441.3993
LVGI 1.94911.9553
TATA -0.004-0.0094
M-score -2.29-2.56
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