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Dick's Sporting Goods Inc (NYSE:DKS)
Beneish M-Score
-2.69 (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 -2.69 suggests that the company is not a manipulator.

DKS' s 10-Year Beneish M-Score Range
Min: -3.7   Max: 0.28
Current: -2.69

-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 * 1.1475+0.528 * 1.0225+0.404 * 0.7777+0.892 * 1.0825+0.115 * 1.029
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0006+4.679 * -0.071-0.327 * 1.024
=-2.69

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

This Year (Jul14) TTM:Last Year (Jul13) TTM:
Accounts Receivable was $109 Mil.
Revenue was 1688.89 + 1438.908 + 1947.418 + 1400.623 = $6,476 Mil.
Gross Profit was 502.556 + 440.883 + 628.067 + 424.899 = $1,996 Mil.
Total Current Assets was $1,757 Mil.
Total Assets was $3,255 Mil.
Property, Plant and Equipment(Net PPE) was $1,138 Mil.
Depreciation, Depletion and Amortization(DDA) was $168 Mil.
Selling, General & Admin. Expense(SGA) was $1,471 Mil.
Total Current Liabilities was $1,133 Mil.
Long-Term Debt was $6 Mil.
Net Income was 69.467 + 69.984 + 138.637 + 49.977 = $328 Mil.
Non Operating Income was 2.013 + 2.364 + 1.549 + 2.735 = $9 Mil.
Cash Flow from Operations was 138.295 + 13.924 + 461.573 + -63.109 = $551 Mil.
Accounts Receivable was $87 Mil.
Revenue was 1531.431 + 1333.701 + 1805.301 + 1312.072 = $5,983 Mil.
Gross Profit was 479.33 + 411.654 + 588.651 + 406.124 = $1,886 Mil.
Total Current Assets was $1,653 Mil.
Total Assets was $3,019 Mil.
Property, Plant and Equipment(Net PPE) was $937 Mil.
Depreciation, Depletion and Amortization(DDA) was $143 Mil.
Selling, General & Admin. Expense(SGA) was $1,358 Mil.
Total Current Liabilities was $1,025 Mil.
Long-Term Debt was $6 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)
=(108.576 / 6475.839) / (87.411 / 5982.505)
=0.01676632 / 0.0146111
=1.1475

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)
=(440.883 / 5982.505) / (502.556 / 6475.839)
=0.31521227 / 0.30828515
=1.0225

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 - (1757.16 + 1138.182) / 3255.483) / (1 - (1652.675 + 937.31) / 3019.471)
=0.11062598 / 0.14223882
=0.7777

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
=6475.839 / 5982.505
=1.0825

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))
=(143.31 / (143.31 + 937.31)) / (168.385 / (168.385 + 1138.182))
=0.13261831 / 0.1288759
=1.029

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)
=(1470.655 / 6475.839) / (1357.75 / 5982.505)
=0.22709876 / 0.22695343
=1.0006

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)
=((6.232 + 1132.882) / 3255.483) / ((6.36 + 1025.451) / 3019.471)
=0.3499063 / 0.34171913
=1.024

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
=(328.065 - 8.661 - 550.683) / 3255.483
=-0.071

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 -2.69 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

Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14
DSRI 0.86020.97940.55121.05940.97781.3081.79751.26931.38591.1475
GMI 0.97010.97720.97730.97210.97930.98210.9951.00611.00841.0225
AQI 1.10831.16391.2431.33931.14831.03360.83830.76350.72810.7777
SGI 1.08951.0981.10221.11981.09451.08581.0761.06461.07311.0825
DEPI 1.04661.05861.05931.00551.00280.95041.00861.03681.00581.029
SGAI 0.95390.95110.98211.00871.01521.02541.01411.00630.99731.0006
LVGI 0.98440.88730.90630.95670.93611.00761.0960.94070.97561.024
TATA -0.0452-0.0199-0.0512-0.0415-0.02-0.01940.0057-0.0256-0.0486-0.071
M-score -2.69-2.40-2.91-2.38-2.44-2.22-1.75-2.36-2.38-2.69
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