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DryShips Inc (NAS:DRYS)
Beneish M-Score
-18.54 (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 -18.54 suggests that the company is not a manipulator.

DRYS' s Beneish M-Score Range Over the Past 10 Years
Min: -46.45   Max: 2.25
Current: -18.54

-46.45
2.25

During the past 13 years, the highest Beneish M-Score of DryShips Inc was 2.25. The lowest was -46.45. And the median was -2.25.


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 * 10.8985+0.528 * -24.6495+0.404 * 0.1066+0.892 * 0.0428+0.115 * 29.7215
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 6.4941+4.679 * -2.6645-0.327 * 1.9229
=-18.54

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $6.85 Mil.
Revenue was 17.247 + 13.177 + 11.86 + 23.766 = $66.05 Mil.
Gross Profit was 5.84 + -0.625 + -5.849 + -0.89 = $-1.52 Mil.
Total Current Assets was $126.54 Mil.
Total Assets was $229.73 Mil.
Property, Plant and Equipment(Net PPE) was $93.83 Mil.
Depreciation, Depletion and Amortization(DDA) was $3.27 Mil.
Selling, General & Admin. Expense(SGA) was $40.19 Mil.
Total Current Liabilities was $216.72 Mil.
Long-Term Debt was $0.00 Mil.
Net Income was -5.247 + -9.108 + -106.815 + -527.619 = $-648.79 Mil.
Non Operating Income was 0.144 + -1.284 + -2.382 + -1.539 = $-5.06 Mil.
Cash Flow from Operations was -5.346 + -7.318 + -5.484 + -13.463 = $-31.61 Mil.
Accounts Receivable was $14.70 Mil.
Revenue was 50.766 + 403.182 + 492.111 + 598.411 = $1,544.47 Mil.
Gross Profit was 5.04 + 246.433 + 282.882 + 344.061 = $878.42 Mil.
Total Current Assets was $765.87 Mil.
Total Assets was $1,239.36 Mil.
Property, Plant and Equipment(Net PPE) was $0.00 Mil.
Depreciation, Depletion and Amortization(DDA) was $343.23 Mil.
Selling, General & Admin. Expense(SGA) was $144.71 Mil.
Total Current Liabilities was $608.03 Mil.
Long-Term Debt was $0.00 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)
=(6.85 / 66.05) / (14.697 / 1544.47)
=0.10370931 / 0.00951589
=10.8985

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)
=(878.416 / 1544.47) / (-1.524 / 66.05)
=0.56874915 / -0.02307343
=-24.6495

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 - (126.537 + 93.833) / 229.727) / (1 - (765.867 + 0) / 1239.358)
=0.04073095 / 0.38204538
=0.1066

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
=66.05 / 1544.47
=0.0428

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))
=(343.234 / (343.234 + 0)) / (3.267 / (3.267 + 93.833))
=1 / 0.03364573
=29.7215

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)
=(40.189 / 66.05) / (144.708 / 1544.47)
=0.60846329 / 0.09369428
=6.4941

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)
=((0 + 216.719) / 229.727) / ((0 + 608.028) / 1239.358)
=0.94337627 / 0.49059917
=1.9229

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
=(-648.789 - -5.061 - -31.611) / 229.727
=-2.6645

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 -18.54 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 local exchange's currency.

DryShips Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.53262.56221.47631.67610.36044.43051.11331.49250.8580.056
GMI 1.07170.88621.051.10940.96281.1761.4480.83940.93221.0182
AQI 0.86437.12470.06640.790610.12730.57180.54040.6020.634820.2208
SGI 1.08532.3451.85510.75861.04871.25351.12291.23291.46480.4437
DEPI 0.89691.19141.11170.90871.15991.01570.83821.06360.8260.0676
SGAI 0.60252.667.87361.85170.24111.11011.35320.94420.60651.2206
LVGI 1.00950.89561.24530.72540.84351.26591.03251.09750.95841.2944
TATA -0.03670.033-0.1406-0.0568-0.0255-0.0417-0.0484-0.0325-0.0368-6.3259
M-score -2.972.50-3.54-2.430.720.52-2.53-2.23-2.49-25.91

DryShips Inc Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 1.05481.1960.8581.11060.11350.0420.0560.07933.186710.8985
GMI 0.78550.83420.93220.95110.93710.97221.01821.1337-24.9482-24.6495
AQI 0.66060.79010.63480.51379.726929.658620.220819.41980.21460.1066
SGI 1.42051.50241.46481.36221.15050.76520.44370.22050.04750.0428
DEPI 0.97580.88490.8260.81140.1790.04490.06760.0931.367229.7215
SGAI 0.62490.53140.6280.71990.78910.98691.21711.72095.67716.4941
LVGI 1.12961.04220.95840.96250.72410.80291.29441.6362.20911.9229
TATA -0.0439-0.0399-0.0427-0.0466-0.7425-2.1867-6.3259-10.5806-6.048-2.6645
M-score -2.49-2.16-2.52-2.46-3.11-2.28-25.91-46.45-44.79-18.54
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