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DaVita HealthCare Partners Inc (NYSE:DVA)
Beneish M-Score
-2.64 (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.

DaVita HealthCare Partners Inc has a M-score of -2.63 suggests that the company is not a manipulator.

DVA' s 10-Year Beneish M-Score Range
Min: -3.52   Max: -0.76
Current: -2.64

-3.52
-0.76

During the past 13 years, the highest Beneish M-Score of DaVita HealthCare Partners Inc was -0.76. The lowest was -3.52. And the median was -2.60.


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 DaVita HealthCare Partners 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 * 0.8097+0.528 * 1.0544+0.404 * 0.9567+0.892 * 1.3019+0.115 * 0.8719
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.917+4.679 * -0.0593-0.327 * 0.9465
=-2.63

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $1,914 Mil.
Revenue was 3042.776 + 3063.209 + 2999.586 + 2871.673 = $11,977 Mil.
Gross Profit was 863.004 + 935.377 + 904.252 + 857.353 = $3,560 Mil.
Total Current Assets was $3,707 Mil.
Total Assets was $17,398 Mil.
Property, Plant and Equipment(Net PPE) was $2,224 Mil.
Depreciation, Depletion and Amortization(DDA) was $545 Mil.
Selling, General & Admin. Expense(SGA) was $1,176 Mil.
Total Current Liabilities was $2,566 Mil.
Long-Term Debt was $8,072 Mil.
Net Income was 183.289 + 212.278 + 136.628 + 254.376 = $787 Mil.
Non Operating Income was 1.698 + 3.45 + 2.113 + -1.374 = $6 Mil.
Cash Flow from Operations was 419.107 + 354.187 + 733.128 + 306.819 = $1,813 Mil.
Accounts Receivable was $1,816 Mil.
Revenue was 2829.582 + 2477.853 + 1962.966 + 1929.74 = $9,200 Mil.
Gross Profit was 868.691 + 775.09 + 622.048 + 617.493 = $2,883 Mil.
Total Current Assets was $3,191 Mil.
Total Assets was $16,413 Mil.
Property, Plant and Equipment(Net PPE) was $1,915 Mil.
Depreciation, Depletion and Amortization(DDA) was $397 Mil.
Selling, General & Admin. Expense(SGA) was $985 Mil.
Total Current Liabilities was $2,325 Mil.
Long-Term Debt was $8,277 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)
=(1913.745 / 11977.244) / (1815.513 / 9200.141)
=0.15978175 / 0.19733535
=0.8097

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)
=(935.377 / 9200.141) / (863.004 / 11977.244)
=0.31339976 / 0.29722915
=1.0544

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 - (3707.233 + 2224.439) / 17398.342) / (1 - (3191.168 + 1915.453) / 16413.477)
=0.65906682 / 0.68887634
=0.9567

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
=11977.244 / 9200.141
=1.3019

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))
=(396.677 / (396.677 + 1915.453)) / (544.928 / (544.928 + 2224.439))
=0.17156345 / 0.19676988
=0.8719

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)
=(1176.136 / 11977.244) / (985.243 / 9200.141)
=0.09819755 / 0.10708999
=0.917

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)
=((8071.622 + 2566.174) / 17398.342) / ((8277.259 + 2325.239) / 16413.477)
=0.61142585 / 0.64596295
=0.9465

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
=(786.571 - 5.887 - 1813.241) / 17398.342
=-0.0593

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.

DaVita HealthCare Partners Inc has a M-score of -2.63 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.

DaVita HealthCare Partners Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.051.53720.67910.96611.11170.94210.99960.97890.97930.73
GMI 1.01331.0291.03370.96031.03451.00941.0570.92430.97861.0509
AQI 0.95541.25910.98160.95770.97230.97360.96961.09211.20770.9524
SGI 1.13451.36591.64121.07861.07521.07931.01811.08241.21611.437
DEPI 1.03041.26250.81270.99160.9960.99891.02921.06071.01340.7985
SGAI 1.05121.06041.05641.00420.75280.9691.05661.10631.17750.835
LVGI 0.92331.15070.9230.9210.96320.91551.04920.98631.030.9602
TATA -0.0803-0.0418-0.00060.0041-0.0346-0.0328-0.0447-0.0792-0.0348-0.0669
M-score -2.68-1.76-2.20-2.44-2.41-2.59-2.68-2.81-2.44-2.63

DaVita HealthCare Partners Inc Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.97970.96990.90190.90530.97520.93380.89990.7940.7330.8097
GMI 0.92410.88380.87170.8920.97981.02291.05591.06171.04951.0544
AQI 1.09211.09011.09071.10081.20771.1921.1611.07130.95240.9567
SGI 1.08151.12711.15651.16891.22111.31071.39171.4921.43111.3019
DEPI 1.06071.05811.05641.01291.0060.92520.86220.80630.80430.8719
SGAI 1.10721.11781.11191.06591.08391.01780.94560.9480.90710.917
LVGI 0.98630.97720.94970.99521.031.0481.04410.98320.96020.9465
TATA -0.0792-0.0723-0.0914-0.0654-0.0462-0.0547-0.0401-0.0616-0.0669-0.0593
M-score -2.81-2.76-2.89-2.75-2.47-2.46-2.34-2.47-2.64-2.63
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