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Dick's Sporting Goods Inc (NYSE:DKS)
Beneish M-Score
-2.77 (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 -2.77 suggests that the company is not a manipulator.

DKS' s 10-Year Beneish M-Score Range
Min: -3.38   Max: -0.18
Current: -2.77

-3.38
-0.18

During the past 13 years, the highest Beneish M-Score of Dick's Sporting Goods Inc was -0.18. The lowest was -3.38. And the median was -2.52.


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 * 0.9937+0.528 * 1.0235+0.404 * 0.9189+0.892 * 1.0874+0.115 * 0.9826
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9977+4.679 * -0.0666-0.327 * 1.0955
=-2.77

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

This Year (Oct14) TTM:Last Year (Oct13) TTM:
Accounts Receivable was $88 Mil.
Revenue was 1526.675 + 1688.89 + 1438.908 + 1947.418 = $6,602 Mil.
Gross Profit was 451.972 + 502.556 + 440.883 + 628.067 = $2,023 Mil.
Total Current Assets was $2,076 Mil.
Total Assets was $3,656 Mil.
Property, Plant and Equipment(Net PPE) was $1,195 Mil.
Depreciation, Depletion and Amortization(DDA) was $172 Mil.
Selling, General & Admin. Expense(SGA) was $1,497 Mil.
Total Current Liabilities was $1,259 Mil.
Long-Term Debt was $287 Mil.
Net Income was 49.211 + 69.467 + 69.984 + 138.638 = $327 Mil.
Non Operating Income was 0.486 + 2.013 + 2.364 + 1.549 = $6 Mil.
Cash Flow from Operations was -49.462 + 138.295 + 13.924 + 461.573 = $564 Mil.
Accounts Receivable was $81 Mil.
Revenue was 1400.623 + 1531.431 + 1333.701 + 1805.301 = $6,071 Mil.
Gross Profit was 424.899 + 479.33 + 411.654 + 588.651 = $1,905 Mil.
Total Current Assets was $1,905 Mil.
Total Assets was $3,348 Mil.
Property, Plant and Equipment(Net PPE) was $1,060 Mil.
Depreciation, Depletion and Amortization(DDA) was $150 Mil.
Selling, General & Admin. Expense(SGA) was $1,380 Mil.
Total Current Liabilities was $1,169 Mil.
Long-Term Debt was $123 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)
=(87.944 / 6601.891) / (81.389 / 6071.056)
=0.01332103 / 0.01340607
=0.9937

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)
=(502.556 / 6071.056) / (451.972 / 6601.891)
=0.3137072 / 0.30649976
=1.0235

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 - (2075.865 + 1195.274) / 3655.532) / (1 - (1904.925 + 1059.865) / 3347.895)
=0.10515378 / 0.11443161
=0.9189

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
=6601.891 / 6071.056
=1.0874

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))
=(149.906 / (149.906 + 1059.865)) / (172.491 / (172.491 + 1195.274))
=0.12391271 / 0.12611158
=0.9826

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)
=(1496.85 / 6601.891) / (1379.665 / 6071.056)
=0.22673049 / 0.22725289
=0.9977

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)
=((286.608 + 1258.779) / 3655.532) / ((122.996 + 1169.004) / 3347.895)
=0.42275297 / 0.38591413
=1.0955

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
=(327.3 - 6.412 - 564.33) / 3655.532
=-0.0666

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 -2.77 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 2.0490.77091.13921.25190.87730.57380.89421.02450.80651.6488
GMI 0.9970.98950.97590.96681.03881.03960.92710.9720.97211.0061
AQI 3.97090.94480.82761.47520.87930.90610.83480.87111.33930.7635
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 1.31040.90280.8910.94690.87451.030.91190.95940.95670.9407
TATA -0.0469-0.0828-0.0483-0.0474-0.002-0.1185-0.0809-0.0535-0.0415-0.0256
M-score -0.20-2.88-2.46-2.07-2.55-3.38-2.95-2.68-2.61-2.02

Dick's Sporting Goods Inc Quarterly Data

Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14
DSRI 0.87990.81660.80651.00151.4571.32211.64881.34491.11190.9937
GMI 0.97720.97730.97210.97930.98210.9951.00611.00841.02251.0235
AQI 1.16391.2431.33931.14831.03360.83830.76350.72810.77770.9189
SGI 1.0981.10221.11981.09451.08581.0761.06461.07311.08251.0874
DEPI 1.05861.05931.00551.00280.95041.00861.03681.00581.0290.9826
SGAI 0.95110.98211.00871.01521.02541.01411.00630.99731.00060.9977
LVGI 0.88730.90630.95670.93611.00761.0960.94070.97561.0241.0955
TATA -0.0199-0.0512-0.0415-0.02-0.01940.0057-0.0256-0.0486-0.071-0.0666
M-score -2.49-2.67-2.61-2.42-2.08-2.19-2.02-2.42-2.72-2.77
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