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DryShips Inc (NAS:DRYS)
Beneish M-Score
-46.45 (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 -46.45 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: -46.45

-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 -2.07.


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 * 0.0793+0.528 * 1.1337+0.404 * 19.4197+0.892 * 0.2205+0.115 * 0.093
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.7209+4.679 * -10.5806-0.327 * 1.636
=-46.45

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $9.7 Mil.
Revenue was 11.86 + 23.766 + 50.766 + 403.182 = $489.6 Mil.
Gross Profit was -5.849 + -0.89 + 5.04 + 246.433 = $244.7 Mil.
Total Current Assets was $133.7 Mil.
Total Assets was $287.1 Mil.
Property, Plant and Equipment(Net PPE) was $95.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $109.8 Mil.
Selling, General & Admin. Expense(SGA) was $71.5 Mil.
Total Current Liabilities was $280.0 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was -106.815 + -527.619 + -819.962 + -1440.323 = $-2,894.7 Mil.
Non Operating Income was -2.382 + 1345.567 + -14.6 + -1363.677 = $-35.1 Mil.
Cash Flow from Operations was -5.484 + -13.463 + 19.302 + 177.86 = $178.2 Mil.
Accounts Receivable was $554.2 Mil.
Revenue was 492.111 + 598.411 + 601.954 + 527.673 = $2,220.1 Mil.
Gross Profit was 282.882 + 344.061 + 346.939 + 284.334 = $1,258.2 Mil.
Total Current Assets was $1,837.8 Mil.
Total Assets was $10,764.9 Mil.
Property, Plant and Equipment(Net PPE) was $8,815.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $461.2 Mil.
Selling, General & Admin. Expense(SGA) was $188.5 Mil.
Total Current Liabilities was $1,651.5 Mil.
Long-Term Debt was $4,766.4 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)
=(9.696 / 489.574) / (554.188 / 2220.149)
=0.01980497 / 0.24961748
=0.0793

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)
=(1258.216 / 2220.149) / (244.734 / 489.574)
=0.56672593 / 0.49989174
=1.1337

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 - (133.703 + 95.566) / 287.115) / (1 - (1837.793 + 8815.412) / 10764.887)
=0.20147328 / 0.01037466
=19.4197

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
=489.574 / 2220.149
=0.2205

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))
=(461.211 / (461.211 + 8815.412)) / (109.818 / (109.818 + 95.566))
=0.04971755 / 0.53469598
=0.093

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)
=(71.514 / 489.574) / (188.454 / 2220.149)
=0.14607393 / 0.08488349
=1.7209

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 + 280.043) / 287.115) / ((4766.393 + 1651.45) / 10764.887)
=0.97536875 / 0.59618303
=1.636

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
=(-2894.719 - -35.092 - 178.215) / 287.115
=-10.5806

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 -46.45 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 1.05490.88351.05321.10940.96281.1761.4480.83940.93221.0182
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 1.30550.263436.68621.85170.23761.04481.45930.96410.5941.2206
LVGI 1.00950.89561.24530.72540.84351.26591.03251.09750.95841.2944
TATA -0.03640.0317-0.1406-0.0577-0.0256-0.0419-0.0484-0.0474-0.0496-6.3259
M-score -3.102.90-8.49-2.440.720.53-2.55-2.30-2.55-25.91

DryShips Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.49251.34541.05481.1960.8581.11060.11350.0420.0560.0793
GMI 0.83940.78710.78550.83420.93220.95110.93710.97221.01821.1337
AQI 0.6020.55920.66060.79010.63480.51379.726929.658620.220819.4198
SGI 1.23291.27091.42051.50241.46481.36221.15050.76520.44370.2205
DEPI 1.06361.0270.97580.88490.8260.81140.1790.04490.06760.093
SGAI 0.95240.70670.62490.53140.6280.71990.78910.98691.21711.7209
LVGI 1.09751.12591.12961.04220.95840.96250.72410.80291.29441.636
TATA -0.043-0.023-0.0439-0.0399-0.0427-0.0466-0.2275-1.0998-6.3259-10.5806
M-score -2.28-2.31-2.49-2.16-2.52-2.46-0.702.80-25.91-46.45
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