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Dover Corp (NYSE:DOV)
Beneish M-Score
-2.72 (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.

Dover Corp has a M-score of -2.72 suggests that the company is not a manipulator.

DOV' s 10-Year Beneish M-Score Range
Min: -3.46   Max: -1.76
Current: -2.72

-3.46
-1.76

During the past 13 years, the highest Beneish M-Score of Dover Corp was -1.76. The lowest was -3.46. And the median was -2.60.


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 Dover Corp 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 * 0.868+0.528 * 1.032+0.404 * 1.0037+0.892 * 1.0542+0.115 * 0.9358
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0108+4.679 * -0.0346-0.327 * 1.0455
=-2.72

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $1,133 Mil.
Revenue was 1715.501 + 1727.876 + 2092.467 + 2047.738 = $7,584 Mil.
Gross Profit was 627.159 + 639.781 + 801.842 + 796.417 = $2,865 Mil.
Total Current Assets was $2,672 Mil.
Total Assets was $8,647 Mil.
Property, Plant and Equipment(Net PPE) was $822 Mil.
Depreciation, Depletion and Amortization(DDA) was $311 Mil.
Selling, General & Admin. Expense(SGA) was $1,741 Mil.
Total Current Liabilities was $1,782 Mil.
Long-Term Debt was $2,218 Mil.
Net Income was 209.51 + 169.294 + 231.844 + 213.959 = $825 Mil.
Non Operating Income was 4.187 + -0.587 + 0.803 + 6.042 = $10 Mil.
Cash Flow from Operations was 134.049 + 425.06 + 290.243 + 263.623 = $1,113 Mil.
Accounts Receivable was $1,238 Mil.
Revenue was 1802.57 + 1518.497 + 1940.211 + 1932.411 = $7,194 Mil.
Gross Profit was 707.86 + 584.808 + 756.347 + 755.818 = $2,805 Mil.
Total Current Assets was $2,702 Mil.
Total Assets was $8,664 Mil.
Property, Plant and Equipment(Net PPE) was $818 Mil.
Depreciation, Depletion and Amortization(DDA) was $283 Mil.
Selling, General & Admin. Expense(SGA) was $1,634 Mil.
Total Current Liabilities was $1,231 Mil.
Long-Term Debt was $2,602 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)
=(1133.213 / 7583.582) / (1238.368 / 7193.689)
=0.14942978 / 0.17214645
=0.868

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)
=(639.781 / 7193.689) / (627.159 / 7583.582)
=0.3899019 / 0.37781605
=1.032

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 - (2671.551 + 821.736) / 8646.705) / (1 - (2701.709 + 817.818) / 8664.39)
=0.5959979 / 0.59379402
=1.0037

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
=7583.582 / 7193.689
=1.0542

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))
=(283.204 / (283.204 + 817.818)) / (311.497 / (311.497 + 821.736))
=0.2572192 / 0.27487463
=0.9358

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)
=(1741.117 / 7583.582) / (1633.888 / 7193.689)
=0.22959032 / 0.22712797
=1.0108

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)
=((2217.874 + 1782.054) / 8646.705) / ((2602.334 + 1231.409) / 8664.39)
=0.46259564 / 0.4424712
=1.0455

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
=(824.607 - 10.445 - 1112.975) / 8646.705
=-0.0346

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.

Dover Corp has a M-score of -2.72 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.

Dover Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.85260.99280.92960.87611.13661.17010.85280.99630.99481.0173
GMI 1.00210.9781.00531.00590.99240.91661.02721.00690.98721.0122
AQI 1.22550.94630.95750.97021.03220.90491.06881.07631.13150.8703
SGI 1.14631.23261.14171.04740.76311.05781.20621.09980.88291.0835
DEPI 0.89710.89730.89830.9350.97021.11530.92460.9820.89910.9716
SGAI 0.98050.96681.01890.98941.16440.93820.95140.97310.99441.0039
LVGI 1.03931.0311.01531.01020.90020.98341.00421.14210.90811.3005
TATA -0.0299-0.0422-0.026-0.054-0.0563-0.0279-0.0196-0.0436-0.0142-0.0227
M-score -2.55-2.53-2.57-2.82-2.82-2.46-2.48-2.61-2.59-2.64

Dover Corp Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 0.99630.97581.02520.99970.99481.04040.99540.95481.02820.868
GMI 1.00690.99690.98520.98950.98720.98610.9941.00111.01121.032
AQI 1.07631.08521.0591.05281.13150.98440.96810.95640.87031.0037
SGI 1.09981.05351.03351.01820.88290.9090.93610.97531.07211.0542
DEPI 0.9820.95021.02671.07460.89910.90630.85360.79930.97160.9358
SGAI 0.97310.99480.98680.9910.99440.99630.99641.0011.00371.0108
LVGI 1.14211.1551.14251.12760.90811.09361.08151.12131.30051.0455
TATA -0.0436-0.0377-0.0313-0.0325-0.0142-0.0141-0.0227-0.0205-0.0227-0.0346
M-score -2.61-2.65-2.60-2.63-2.59-2.64-2.71-2.72-2.64-2.72
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