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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.
During the past 13 years, the highest Beneish M-Score of Delhaize Group SA was -2.46. The lowest was -3.96. And the median was -2.79.
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 Delhaize Group SA 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 * 0.9564||+||0.528 * 0.9977||+||0.404 * 1.0303||+||0.892 * 0.9827||+||0.115 * 0.9701|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.0102||+||4.679 * -0.0852||-||0.327 * 0.9668|
|This Year (Sep15) TTM:||Last Year (Sep14) TTM:|
|Accounts Receivable was $673 Mil.|
Revenue was 6892.25589226 + 6861.95286195 + 6298.7012987 + 7145.49938348 = $27,198 Mil.
Gross Profit was 1672.27833895 + 1674.52300786 + 1536.7965368 + 1711.46732429 = $6,595 Mil.
Total Current Assets was $4,102 Mil.
Total Assets was $13,896 Mil.
Property, Plant and Equipment(Net PPE) was $4,785 Mil.
Depreciation, Depletion and Amortization(DDA) was $744 Mil.
Selling, General & Admin. Expense(SGA) was $5,788 Mil.
Total Current Liabilities was $3,559 Mil.
Long-Term Debt was $2,685 Mil.
Net Income was 132.435465769 + 118.967452301 + 30.303030303 + -67.8175092478 = $214 Mil.
Non Operating Income was -3.367003367 + 6.73400673401 + -1.08225108225 + -2.46609124538 = $-0 Mil.
Cash Flow from Operations was 193.041526375 + 567.901234568 + -27.0562770563 + 664.611590629 = $1,398 Mil.
|Accounts Receivable was $716 Mil.
Revenue was 6913.65979381 + 7032.60869565 + 6950.20746888 + 6780.521262 = $27,677 Mil.
Gross Profit was 1664.94845361 + 1694.29347826 + 1676.34854772 + 1659.8079561 = $6,695 Mil.
Total Current Assets was $4,454 Mil.
Total Assets was $14,939 Mil.
Property, Plant and Equipment(Net PPE) was $5,259 Mil.
Depreciation, Depletion and Amortization(DDA) was $790 Mil.
Selling, General & Admin. Expense(SGA) was $5,830 Mil.
Total Current Liabilities was $3,540 Mil.
Long-Term Debt was $3,403 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(673.400673401 / 27198.4094364)||/||(716.494845361 / 27676.9972203)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(1674.52300786 / 27676.9972203)||/||(1672.27833895 / 27198.4094364)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (4102.13243547 + 4784.51178451) / 13895.6228956)||/||(1 - (4453.60824742 + 5259.02061856) / 14939.4329897)|
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.
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))|
|=||(789.951372656 / (789.951372656 + 5259.02061856))||/||(744.291702574 / (744.291702574 + 4784.51178451))|
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)|
|=||(5787.97229928 / 27198.4094364)||/||(5830.48333803 / 27676.9972203)|
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)|
|=||((2684.62401796 + 3558.92255892) / 13895.6228956)||/||((3403.35051546 + 3539.94845361) / 14939.4329897)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(213.888439125 - -0.181338960624||-||1398.49807452)||/||13895.6228956|
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.
Delhaize Group SA has a M-score of -2.92 suggests that the company will not be a manipulator.
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
Delhaize Group SA Annual Data
Delhaize Group SA Quarterly Data