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DryShips Inc (NAS:DRYS)
Beneish M-Score
-2.47 (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.

DryShips Inc has a M-score of -2.47 suggests that the company is not a manipulator.

DRYS' s 10-Year Beneish M-Score Range
Min: -5.69   Max: 2.48
Current: -2.47

-5.69
2.48

During the past 13 years, the highest Beneish M-Score of DryShips Inc was 2.48. The lowest was -5.69. And the median was -2.14.


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 DryShips 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 * 1.1106+0.528 * 0.9511+0.404 * 0.5137+0.892 * 1.3622+0.115 * 0.7989
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.5858+4.679 * -0.0533-0.327 * 0.9625
=-2.47

* 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 $554 Mil.
Revenue was 492.111 + 598.411 + 601.954 + 527.673 = $2,220 Mil.
Gross Profit was 282.882 + 344.061 + 346.939 + 284.334 = $1,258 Mil.
Total Current Assets was $1,838 Mil.
Total Assets was $10,765 Mil.
Property, Plant and Equipment(Net PPE) was $8,815 Mil.
Depreciation, Depletion and Amortization(DDA) was $795 Mil.
Selling, General & Admin. Expense(SGA) was $188 Mil.
Total Current Liabilities was $1,651 Mil.
Long-Term Debt was $4,766 Mil.
Net Income was -59.157 + -23.997 + 16.67 + -5.634 = $-72 Mil.
Non Operating Income was -18.655 + 111.469 + -110.065 + 46.666 = $29 Mil.
Cash Flow from Operations was 32.048 + 208.662 + 68.57 + 162.459 = $472 Mil.
Accounts Receivable was $366 Mil.
Revenue was 457.486 + 431.352 + 404.941 + 336.008 = $1,630 Mil.
Gross Profit was 248.765 + 236.034 + 224.808 + 168.849 = $878 Mil.
Total Current Assets was $1,410 Mil.
Total Assets was $10,713 Mil.
Property, Plant and Equipment(Net PPE) was $9,087 Mil.
Depreciation, Depletion and Amortization(DDA) was $643 Mil.
Selling, General & Admin. Expense(SGA) was $235 Mil.
Total Current Liabilities was $2,359 Mil.
Long-Term Debt was $4,278 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)
=(554.188 / 2220.149) / (366.295 / 1629.787)
=0.24961748 / 0.22475023
=1.1106

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)
=(344.061 / 1629.787) / (282.882 / 2220.149)
=0.5390005 / 0.56672593
=0.9511

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 - (1837.793 + 8815.412) / 10764.887) / (1 - (1410.175 + 9086.874) / 10713.415)
=0.01037466 / 0.0201958
=0.5137

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
=2220.149 / 1629.787
=1.3622

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))
=(642.855 / (642.855 + 9086.874)) / (794.749 / (794.749 + 8815.412))
=0.06607121 / 0.08269882
=0.7989

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)
=(187.883 / 2220.149) / (235.444 / 1629.787)
=0.0846263 / 0.14446305
=0.5858

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)
=((4766.393 + 1651.45) / 10764.887) / ((4277.545 + 2358.514) / 10713.415)
=0.59618303 / 0.61941584
=0.9625

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
=(-72.118 - 29.415 - 471.739) / 10764.887
=-0.0533

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.

DryShips Inc has a M-score of -2.47 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.

DryShips Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.70510.53262.56221.47631.67610.36044.43051.11331.49250.858
GMI 0.93781.07170.88621.051.10940.96281.1761.4480.83940.9322
AQI 0.08750.86437.12470.06640.791710.11350.5430.56910.6020.634
SGI 3.60731.08532.3451.85510.75861.04871.25351.12291.23291.4648
DEPI 1.88770.89691.19141.11170.90721.16181.01570.83821.06360.826
SGAI 5.25080.60252.667.87361.85170.23761.04481.45930.96410.594
LVGI 0.59351.00950.89561.24530.72640.84231.26841.03051.09750.9592
TATA -0.0578-0.03670.033-0.1406-0.0578-0.0256-0.0499-0.0484-0.0474-0.0496
M-score -1.59-2.972.50-3.54-2.440.720.48-2.54-2.30-2.55

DryShips Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 1.11331.42751.52861.50271.49251.34541.05481.1960.8581.1106
GMI 1.4481.43761.34941.13460.83940.78710.78550.83420.93220.9511
AQI 0.56910.6020.60390.32980.6020.55920.66060.79010.6340.5137
SGI 1.12291.14731.04261.07021.23291.27091.42051.50241.46481.3622
DEPI 0.82090.87440.9060.96951.07151.06181.0340.94870.82580.7989
SGAI 1.45931.26041.72381.56970.96411.0040.63840.5570.5940.5858
LVGI 1.03051.02921.04281.09131.09751.12591.12961.04220.95920.9625
TATA -0.0484-0.0678-0.0468-0.0484-0.0474-0.0251-0.0511-0.0363-0.0496-0.0533
M-score -2.54-2.27-2.30-2.51-2.30-2.36-2.52-2.14-2.55-2.47
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