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Dover Corp (NYSE:DOV)
Beneish M-Score
-2.95 (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 -2.95 suggests that the company is not a manipulator.

DOV' s 10-Year Beneish M-Score Range
Min: -3.46   Max: -1.76
Current: -2.95

-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 -2.59.


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 * 0.8667+0.528 * 1.0025+0.404 * 0.9681+0.892 * 1.0751+0.115 * 0.4956
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9986+4.679 * -0.0686-0.327 * 1.0815
=-2.95

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $1,303 Mil.
Revenue was 2047.738 + 1884.647 + 2209.128 + 2252.349 = $8,394 Mil.
Gross Profit was 796.417 + 736.209 + 830.557 + 876.65 = $3,240 Mil.
Total Current Assets was $2,904 Mil.
Total Assets was $8,795 Mil.
Property, Plant and Equipment(Net PPE) was $822 Mil.
Depreciation, Depletion and Amortization(DDA) was $680 Mil.
Selling, General & Admin. Expense(SGA) was $1,904 Mil.
Total Current Liabilities was $1,232 Mil.
Long-Term Debt was $2,596 Mil.
Net Income was 213.959 + 160.138 + 193.963 + 269.114 = $837 Mil.
Non Operating Income was 6.042 + -0.356 + 3.016 + -0.97 = $8 Mil.
Cash Flow from Operations was 276.785 + -16.164 + 826.49 + 346.042 = $1,433 Mil.
Accounts Receivable was $1,399 Mil.
Revenue was 1932.411 + 1763.977 + 2013.831 + 2097.605 = $7,808 Mil.
Gross Profit was 755.818 + 681.618 + 773.744 + 810.139 = $3,021 Mil.
Total Current Assets was $3,049 Mil.
Total Assets was $10,349 Mil.
Property, Plant and Equipment(Net PPE) was $1,138 Mil.
Depreciation, Depletion and Amortization(DDA) was $329 Mil.
Selling, General & Admin. Expense(SGA) was $1,774 Mil.
Total Current Liabilities was $1,975 Mil.
Long-Term Debt was $2,190 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)
=(1303.431 / 8393.862) / (1398.829 / 7807.824)
=0.15528383 / 0.17915734
=0.8667

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)
=(736.209 / 7807.824) / (796.417 / 8393.862)
=0.38696044 / 0.38597644
=1.0025

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 - (2903.529 + 821.589) / 8795.074) / (1 - (3048.885 + 1137.645) / 10349.256)
=0.57645405 / 0.59547527
=0.9681

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
=8393.862 / 7807.824
=1.0751

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))
=(329.251 / (329.251 + 1137.645)) / (680.116 / (680.116 + 821.589))
=0.22445422 / 0.45289588
=0.4956

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)
=(1904.197 / 8393.862) / (1773.667 / 7807.824)
=0.22685589 / 0.22716534
=0.9986

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)
=((2596.344 + 1231.7) / 8795.074) / ((2189.811 + 1975.099) / 10349.256)
=0.43524864 / 0.40243569
=1.0815

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
=(837.174 - 7.732 - 1433.153) / 8795.074
=-0.0686

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 -2.95 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.14630.85260.99280.92960.87611.13661.17010.85280.99631.0292
GMI 0.96371.00210.9781.00531.00590.99240.91661.02721.00691.0021
AQI 1.03391.22550.94630.95750.97021.03220.90491.06881.07630.9844
SGI 1.0151.14631.23261.14171.04740.76311.05781.20621.09981.0772
DEPI 1.11730.89710.89730.89830.9350.97021.11530.92460.9820.8926
SGAI 0.96370.98050.96681.01890.98941.16440.93820.95140.97311.001
LVGI 0.96081.03931.0311.01531.01020.90020.98341.00421.14211.2266
TATA -0.032-0.0299-0.0422-0.026-0.054-0.0563-0.0279-0.0196-0.0436-0.0167
M-score -2.45-2.55-2.53-2.57-2.82-2.82-2.46-2.48-2.61-2.55

Dover Corp Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.90650.8840.98640.99630.97581.02520.96051.10140.9040.8667
GMI 1.0281.03551.02211.00690.99690.98520.98980.99460.99491.0025
AQI 1.06981.11271.01351.07631.08521.0591.05280.98440.98440.9681
SGI 1.1581.12851.06861.09981.05351.03351.05971.00661.04611.0751
DEPI 0.91720.86510.92910.9820.95021.02670.87160.65170.51620.4956
SGAI 0.94320.96280.95530.97310.99480.98680.99290.99680.99810.9986
LVGI 0.94770.9680.95861.14211.1551.14251.12761.22661.09361.0815
TATA -0.0201-0.028-0.0111-0.0436-0.0377-0.0313-0.0325-0.0519-0.0592-0.0686
M-score -2.46-2.54-2.45-2.61-2.65-2.60-2.65-2.75-2.90-2.95
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