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Dick's Sporting Goods Inc (NYSE:DKS)
Beneish M-Score
-2.38 (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.

Dick's Sporting Goods Inc has a M-score of -2.38 suggests that the company is not a manipulator.

DKS' s 10-Year Beneish M-Score Range
Min: -3.7   Max: 0.28
Current: -2.38

-3.7
0.28

During the past 13 years, the highest Beneish M-Score of Dick's Sporting Goods Inc was 0.28. The lowest was -3.70. And the median was -2.44.


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 Dick's Sporting Goods 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 * 1.3859+0.528 * 1.0084+0.404 * 0.7281+0.892 * 1.0731+0.115 * 1.0058
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9973+4.679 * -0.0486-0.327 * 0.9756
=-2.38

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

This Year (Apr14) TTM:Last Year (Apr13) TTM:
Accounts Receivable was $73 Mil.
Revenue was 1438.908 + 1947.418 + 1400.623 + 1531.431 = $6,318 Mil.
Gross Profit was 440.883 + 628.067 + 424.899 + 479.33 = $1,973 Mil.
Total Current Assets was $1,821 Mil.
Total Assets was $3,269 Mil.
Property, Plant and Equipment(Net PPE) was $1,077 Mil.
Depreciation, Depletion and Amortization(DDA) was $159 Mil.
Selling, General & Admin. Expense(SGA) was $1,422 Mil.
Total Current Liabilities was $1,145 Mil.
Long-Term Debt was $6 Mil.
Net Income was 69.984 + 138.637 + 49.977 + 84.163 = $343 Mil.
Non Operating Income was 2.364 + 1.549 + 2.735 + 1.735 = $8 Mil.
Cash Flow from Operations was 13.924 + 461.573 + -63.109 + 80.758 = $493 Mil.
Accounts Receivable was $49 Mil.
Revenue was 1333.701 + 1805.301 + 1312.072 + 1437.041 = $5,888 Mil.
Gross Profit was 411.654 + 588.651 + 406.124 + 447.78 = $1,854 Mil.
Total Current Assets was $1,603 Mil.
Total Assets was $2,938 Mil.
Property, Plant and Equipment(Net PPE) was $877 Mil.
Depreciation, Depletion and Amortization(DDA) was $130 Mil.
Selling, General & Admin. Expense(SGA) was $1,329 Mil.
Total Current Liabilities was $1,053 Mil.
Long-Term Debt was $7 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)
=(73.34 / 6318.38) / (49.314 / 5888.115)
=0.01160741 / 0.00837518
=1.3859

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)
=(628.067 / 5888.115) / (440.883 / 6318.38)
=0.31490706 / 0.31229192
=1.0084

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 - (1820.902 + 1077.254) / 3269.437) / (1 - (1602.922 + 876.734) / 2937.875)
=0.11356114 / 0.15596954
=0.7281

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
=6318.38 / 5888.115
=1.0731

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))
=(130.248 / (130.248 + 876.734)) / (158.979 / (158.979 + 1077.254))
=0.12934491 / 0.12859954
=1.0058

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)
=(1421.896 / 6318.38) / (1328.655 / 5888.115)
=0.22504123 / 0.22565031
=0.9973

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)
=((6.356 + 1144.545) / 3269.437) / ((7.137 + 1052.921) / 2937.875)
=0.3520181 / 0.36082475
=0.9756

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
=(342.761 - 8.383 - 493.146) / 3269.437
=-0.0486

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.

Dick's Sporting Goods Inc has a M-score of -2.38 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.

Dick's Sporting Goods Inc Annual Data

Jan05Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14
DSRI 2.53110.62411.5890.89750.96280.6470.90940.90121.05941.2693
GMI 0.9970.98950.97590.96681.03881.03960.92710.9720.97211.0061
AQI 3.97090.94480.82761.47520.86960.91620.83480.87111.33930.7635
SGI 1.43411.24441.18641.24861.06221.06841.10391.06991.11981.0646
DEPI 1.44890.80241.0640.9210.86421.04140.95281.06521.00551.0368
SGAI 0.98781.00091.0391.01890.99990.97241.05220.95361.00871.0063
LVGI 1.28020.88240.8910.94690.87361.0310.91190.95940.95670.9407
TATA -0.0469-0.082-0.0111-0.0474-0.103-0.1194-0.0809-0.0535-0.0415-0.0256
M-score 0.26-3.00-1.87-2.39-2.95-3.32-2.94-2.80-2.38-2.36

Dick's Sporting Goods Inc Quarterly Data

Jan12Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14
DSRI 0.90120.86020.97940.55121.05940.97781.3081.79751.26931.3859
GMI 0.9720.97010.97720.97730.97210.97930.98210.9951.00611.0084
AQI 0.87111.10831.16391.2431.33931.14831.03360.83830.76350.7281
SGI 1.06991.08951.0981.10221.11981.09451.08581.0761.06461.0731
DEPI 1.06521.04661.05861.05931.00551.00280.95041.00861.03681.0058
SGAI 0.95360.95390.95110.98211.00871.01521.02541.01411.00630.9973
LVGI 0.95940.98440.88730.90630.95670.93611.00761.0960.94070.9756
TATA -0.0535-0.0452-0.0199-0.0512-0.0415-0.02-0.01940.0057-0.0256-0.0486
M-score -2.80-2.69-2.40-2.91-2.38-2.44-2.22-1.75-2.36-2.38
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