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Walt Disney Co (NYSE:DIS)
Beneish M-Score
-2.65 (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.

Walt Disney Co has a M-score of -2.65 suggests that the company is not a manipulator.

DIS' s Beneish M-Score Range Over the Past 10 Years
Min: -2.78   Max: -2.02
Current: -2.65

-2.78
-2.02

During the past 13 years, the highest Beneish M-Score of Walt Disney Co was -2.02. The lowest was -2.78. And the median was -2.65.


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 Walt Disney Co 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 * 1.0477+0.528 * 0.9968+0.404 * 0.9887+0.892 * 1.0604+0.115 * 1.0108
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9686+4.679 * -0.0499-0.327 * 1.097
=-2.65

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $8,458 Mil.
Revenue was 13142 + 14277 + 12969 + 15244 = $55,632 Mil.
Gross Profit was 5837 + 7076 + 6105 + 6621 = $25,639 Mil.
Total Current Assets was $16,966 Mil.
Total Assets was $92,033 Mil.
Property, Plant and Equipment(Net PPE) was $27,349 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,527 Mil.
Selling, General & Admin. Expense(SGA) was $8,754 Mil.
Total Current Liabilities was $16,842 Mil.
Long-Term Debt was $16,483 Mil.
Net Income was 1771 + 2597 + 2143 + 2880 = $9,391 Mil.
Non Operating Income was 119 + 108 + 150 + 393 = $770 Mil.
Cash Flow from Operations was 3827 + 3624 + 3400 + 2362 = $13,213 Mil.
Accounts Receivable was $7,613 Mil.
Revenue was 13512 + 13101 + 12461 + 13391 = $52,465 Mil.
Gross Profit was 6157 + 6438 + 5771 + 5735 = $24,101 Mil.
Total Current Assets was $16,758 Mil.
Total Assets was $88,182 Mil.
Property, Plant and Equipment(Net PPE) was $25,179 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,354 Mil.
Selling, General & Admin. Expense(SGA) was $8,523 Mil.
Total Current Liabilities was $16,334 Mil.
Long-Term Debt was $12,773 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)
=(8458 / 55632) / (7613 / 52465)
=0.1520348 / 0.14510626
=1.0477

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)
=(24101 / 52465) / (25639 / 55632)
=0.45937292 / 0.46086785
=0.9968

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 - (16966 + 27349) / 92033) / (1 - (16758 + 25179) / 88182)
=0.51848793 / 0.52442675
=0.9887

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
=55632 / 52465
=1.0604

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))
=(2354 / (2354 + 25179)) / (2527 / (2527 + 27349))
=0.0854974 / 0.08458294
=1.0108

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)
=(8754 / 55632) / (8523 / 52465)
=0.15735548 / 0.16245116
=0.9686

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)
=((16483 + 16842) / 92033) / ((12773 + 16334) / 88182)
=0.36209838 / 0.3300787
=1.097

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
=(9391 - 770 - 13213) / 92033
=-0.0499

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.

Walt Disney Co has a M-score of -2.65 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 local exchange's currency.

Walt Disney Co Annual Data

Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15Sep16
DSRI 0.97231.02640.97381.0477
GMI 1.00160.96830.99860.9968
AQI 1.03980.98470.96680.9887
SGI 1.06541.08371.07481.0604
DEPI 0.94790.99891.04451.0108
SGAI 0.98640.94480.92580.9686
LVGI 0.94851.02241.07141.097
TATA -0.0458-0.0352-0.0373-0.0499
M-score -2.63-2.57-2.63-2.65

Walt Disney Co Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 0.98860.99910.99290.97381.10111.00571.0251.0477
GMI 1.09751.24811.36460.99860.9970.98120.97960.9968
AQI 0.98320.99470.97750.96680.98110.96060.96130.9887
SGI 1.08451.07651.06981.07481.08861.08121.09081.0604
DEPI 1.01121.02121.02161.04451.04961.07351.04961.0108
SGAI 3.87581.89811.28560.92580.93280.94920.95690.9686
LVGI 1.010.94590.98421.07141.05881.20351.18261.097
TATA -0.0373-0.0411-0.036-0.0373-0.0364-0.0406-0.0469-0.0499
M-score -3.04-2.61-2.45-2.63-2.49-2.67-2.67-2.65
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