Switch to:
E.I. du Pont de Nemours & Company (NYSE:DD)
Beneish M-Score
-2.21 (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.

E.I. du Pont de Nemours & Company has a M-score of -2.21 signals that the company is a manipulator.

DD' s 10-Year Beneish M-Score Range
Min: -3.1   Max: -1.73
Current: -2.21

-3.1
-1.73

During the past 13 years, the highest Beneish M-Score of E.I. du Pont de Nemours & Company was -1.73. The lowest was -3.10. And the median was -2.59.


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 E.I. du Pont de Nemours & Company 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 * 1.0835+0.528 * 1.0403+0.404 * 0.8653+0.892 * 1.0236+0.115 * 1.0791
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8914+4.679 * 0.035-0.327 * 0.9718
=-2.21

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $6,047 Mil.
Revenue was 7836 + 7805 + 10003 + 10500 = $36,144 Mil.
Gross Profit was 2703 + 2640 + 3946 + 3395 = $12,684 Mil.
Total Current Assets was $24,384 Mil.
Total Assets was $51,499 Mil.
Property, Plant and Equipment(Net PPE) was $12,993 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,603 Mil.
Selling, General & Admin. Expense(SGA) was $3,668 Mil.
Total Current Liabilities was $13,367 Mil.
Long-Term Debt was $10,741 Mil.
Net Income was 185 + 285 + 1030 + 3348 = $4,848 Mil.
Non Operating Income was -30 + -34 + -45 + -27 = $-136 Mil.
Cash Flow from Operations was 5512 + 298 + 36 + -2667 = $3,179 Mil.
Accounts Receivable was $5,452 Mil.
Revenue was 7572 + 7336 + 10208 + 10194 = $35,310 Mil.
Gross Profit was 2592 + 2557 + 4364 + 3378 = $12,891 Mil.
Total Current Assets was $21,317 Mil.
Total Assets was $49,859 Mil.
Property, Plant and Equipment(Net PPE) was $12,741 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,713 Mil.
Selling, General & Admin. Expense(SGA) was $4,020 Mil.
Total Current Liabilities was $13,552 Mil.
Long-Term Debt was $10,465 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)
=(6047 / 36144) / (5452 / 35310)
=0.16730301 / 0.15440385
=1.0835

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)
=(2640 / 35310) / (2703 / 36144)
=0.36508071 / 0.35092961
=1.0403

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 - (24384 + 12993) / 51499) / (1 - (21317 + 12741) / 49859)
=0.27421892 / 0.3169137
=0.8653

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
=36144 / 35310
=1.0236

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))
=(1713 / (1713 + 12741)) / (1603 / (1603 + 12993))
=0.11851391 / 0.10982461
=1.0791

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)
=(3668 / 36144) / (4020 / 35310)
=0.10148296 / 0.11384877
=0.8914

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)
=((10741 + 13367) / 51499) / ((10465 + 13552) / 49859)
=0.46812559 / 0.48169839
=0.9718

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
=(4848 - -136 - 3179) / 51499
=0.035

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.

E.I. du Pont de Nemours & Company has a M-score of -2.21 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.

E.I. du Pont de Nemours & Company Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.14810.96491.06431.07860.83461.141.05940.89720.88261.0835
GMI 0.92860.87571.04891.13450.99790.93370.96791.03850.71121.0369
AQI 1.22051.10840.83421.11950.90840.9540.96511.41680.90280.8653
SGI 1.00961.01771.01721.01371.08370.85841.05751.19111.02581.0236
DEPI 1.18571.00010.99931.03910.97790.96071.09971.04130.87921.0791
SGAI 1.01441.00820.98341.03921.12170.97080.80050.96811.16710.8914
LVGI 0.80831.12841.0280.96731.12811.03410.97530.97821.01910.9718
TATA -0.0236-0.0648-0.0607-0.071-0.0272-0.0805-0.0388-0.0335-0.03980.035
M-score -2.31-2.86-2.74-2.60-2.79-2.92-2.53-2.35-2.99-2.22

E.I. du Pont de Nemours & Company Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.10620.84530.89260.87640.8530.93680.94890.97431.03961.0835
GMI 1.09631.02760.99660.87770.81130.76780.78190.89250.97111.0403
AQI 1.40771.41681.42870.99720.93830.90280.90810.90670.96580.8653
SGI 1.03011.26431.21771.15411.08110.96640.97120.97321.0131.0236
DEPI 1.12381.04130.98110.84390.82370.87920.92820.9911.09271.0791
SGAI 0.82081.02211.02890.99841.0431.10541.12921.18251.15360.8914
LVGI 1.00970.97820.99460.98280.98991.01910.95290.93170.91220.9718
TATA -0.0313-0.0335-0.0234-0.0228-0.0166-0.03860.01430.02570.03140.035
M-score -2.24-2.35-2.33-2.64-2.77-2.95-2.65-2.51-2.30-2.21
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)
Free 7-day Trial
FEEDBACK
Hide