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DryShips Inc (NAS:DRYS)
Beneish M-Score
-44.79 (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 -44.79 suggests that the company is not a manipulator.

DRYS' s Beneish M-Score Range Over the Past 10 Years
Min: -46.45   Max: 2.8
Current: -44.79

-46.45
2.8

During the past 13 years, the highest Beneish M-Score of DryShips Inc was 2.80. The lowest was -46.45. And the median was -2.19.


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 * 3.1867+0.528 * -24.9482+0.404 * 0.2146+0.892 * 0.0475+0.115 * 1.3672
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 5.6771+4.679 * -6.048-0.327 * 2.2091
=-44.79

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $6.94 Mil.
Revenue was 13.177 + 11.86 + 23.766 + 50.766 = $99.57 Mil.
Gross Profit was -0.625 + -5.849 + -0.89 + 5.04 = $-2.32 Mil.
Total Current Assets was $132.64 Mil.
Total Assets was $237.56 Mil.
Property, Plant and Equipment(Net PPE) was $94.71 Mil.
Depreciation, Depletion and Amortization(DDA) was $19.84 Mil.
Selling, General & Admin. Expense(SGA) was $48.13 Mil.
Total Current Liabilities was $234.15 Mil.
Long-Term Debt was $0.00 Mil.
Net Income was -9.108 + -106.815 + -527.619 + -819.962 = $-1,463.50 Mil.
Non Operating Income was -1.284 + -2.382 + 1345.567 + -1361.706 = $-19.80 Mil.
Cash Flow from Operations was -7.318 + -5.484 + -13.463 + 19.302 = $-6.96 Mil.
Accounts Receivable was $45.86 Mil.
Revenue was 403.182 + 492.111 + 598.411 + 601.954 = $2,095.66 Mil.
Gross Profit was 246.433 + 282.882 + 344.061 + 346.939 = $1,220.32 Mil.
Total Current Assets was $675.71 Mil.
Total Assets was $2,615.94 Mil.
Property, Plant and Equipment(Net PPE) was $1,416.23 Mil.
Depreciation, Depletion and Amortization(DDA) was $439.39 Mil.
Selling, General & Admin. Expense(SGA) was $178.43 Mil.
Total Current Liabilities was $1,167.16 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)
=(6.944 / 99.569) / (45.863 / 2095.658)
=0.06974058 / 0.02188477
=3.1867

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)
=(1220.315 / 2095.658) / (-2.324 / 99.569)
=0.58230637 / -0.0233406
=-24.9482

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 - (132.638 + 94.705) / 237.557) / (1 - (675.714 + 1416.225) / 2615.936)
=0.042996 / 0.20030956
=0.2146

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
=99.569 / 2095.658
=0.0475

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))
=(439.393 / (439.393 + 1416.225)) / (19.839 / (19.839 + 94.705))
=0.23679065 / 0.17319982
=1.3672

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)
=(48.128 / 99.569) / (178.429 / 2095.658)
=0.4833633 / 0.08514223
=5.6771

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 + 234.15) / 237.557) / ((0 + 1167.156) / 2615.936)
=0.98565818 / 0.44617147
=2.2091

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
=(-1463.504 - -19.805 - -6.963) / 237.557
=-6.048

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 -44.79 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

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

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 1.34541.05481.1960.8581.11060.11350.0420.0560.07933.1867
GMI 0.78710.78550.83420.93220.95110.93710.97221.01821.1337-24.9482
AQI 0.55920.66060.79010.63480.51379.726929.658620.220819.41980.2146
SGI 1.27091.42051.50241.46481.36221.15050.76520.44370.22050.0475
DEPI 1.0270.97580.88490.8260.81140.1790.04490.06760.0931.3672
SGAI 0.70670.62490.53140.6280.71990.78910.98691.21711.72095.6771
LVGI 1.12591.12961.04220.95840.96250.72410.80291.29441.6362.2091
TATA -0.023-0.0439-0.0399-0.0427-0.0466-0.7425-1.0998-6.3259-10.5806-6.048
M-score -2.31-2.49-2.16-2.52-2.46-3.112.80-25.91-46.45-44.79
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