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Brinker International Inc (NYSE:EAT)
Beneish M-Score
-3.05 (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.

Brinker International Inc has a M-score of -3.05 suggests that the company is not a manipulator.

EAT' s Beneish M-Score Range Over the Past 10 Years
Min: -6.27   Max: 2.43
Current: -3.05

-6.27
2.43

During the past 13 years, the highest Beneish M-Score of Brinker International Inc was 2.43. The lowest was -6.27. And the median was -3.03.


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 Brinker International 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 * 0.8371+0.528 * 0.996+0.404 * 1.1413+0.892 * 1.0425+0.115 * 0.9569
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9581+4.679 * -0.1012-0.327 * 1.1151
=-3.05

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

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $88 Mil.
Revenue was 788.61 + 762.559 + 764.147 + 784.215 = $3,100 Mil.
Gross Profit was 146.555 + 130.206 + 162.212 + 166.539 = $606 Mil.
Total Current Assets was $254 Mil.
Total Assets was $1,580 Mil.
Property, Plant and Equipment(Net PPE) was $1,071 Mil.
Depreciation, Depletion and Amortization(DDA) was $152 Mil.
Selling, General & Admin. Expense(SGA) was $135 Mil.
Total Current Liabilities was $449 Mil.
Long-Term Debt was $1,156 Mil.
Net Income was 47.694 + 33.207 + 57.223 + 65.427 = $204 Mil.
Non Operating Income was 0.56 + 0.273 + 0.513 + 0.454 = $2 Mil.
Cash Flow from Operations was 110.016 + 45.549 + 93.704 + 112.442 = $362 Mil.
Accounts Receivable was $101 Mil.
Revenue was 742.898 + 711.018 + 759.88 + 759.293 = $2,973 Mil.
Gross Profit was 142.505 + 123.419 + 155.043 + 157.505 = $578 Mil.
Total Current Assets was $285 Mil.
Total Assets was $1,550 Mil.
Property, Plant and Equipment(Net PPE) was $1,045 Mil.
Depreciation, Depletion and Amortization(DDA) was $141 Mil.
Selling, General & Admin. Expense(SGA) was $135 Mil.
Total Current Liabilities was $511 Mil.
Long-Term Debt was $901 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)
=(87.706 / 3099.531) / (100.501 / 2973.089)
=0.02829654 / 0.03380356
=0.8371

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)
=(130.206 / 2973.089) / (146.555 / 3099.531)
=0.19456935 / 0.19535601
=0.996

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 - (253.938 + 1071.232) / 1579.884) / (1 - (285.453 + 1045.447) / 1549.831)
=0.16122323 / 0.14126121
=1.1413

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
=3099.531 / 2973.089
=1.0425

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))
=(141.001 / (141.001 + 1045.447)) / (151.913 / (151.913 + 1071.232))
=0.11884297 / 0.12419868
=0.9569

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)
=(134.584 / 3099.531) / (134.745 / 2973.089)
=0.04342076 / 0.04532155
=0.9581

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)
=((1156.493 + 449.01) / 1579.884) / ((901.241 + 511.109) / 1549.831)
=1.01621575 / 0.91129291
=1.1151

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
=(203.551 - 1.8 - 361.711) / 1579.884
=-0.1012

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.

Brinker International Inc has a M-score of -3.05 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.

Brinker International Inc Annual Data

Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13Jun14Jun15
DSRI 1.1360.89991.08431.10731.15480.98120.99271.0071.06330.9422
GMI 4.11030.24261.0060.99391.00894.13230.95780.95140.98530.9723
AQI 0.92140.92441.2170.97331.30211.16310.98521.09390.99730.9954
SGI 1.06091.05430.96760.85490.78950.9661.02151.0091.02091.0333
DEPI 1.10550.83931.17040.94260.96450.99051.01320.950.98710.9249
SGAI 0.083512.04671.00921.00340.99090.07981.05670.94540.98580.9467
LVGI 1.15771.31761.10060.89520.90231.16281.12391.17291.08021.1108
TATA -0.1192-0.1122-0.1431-0.1053-0.1105-0.0843-0.1084-0.0895-0.1396-0.1212
M-score -1.13-5.50-3.02-2.99-2.89-1.10-3.05-2.92-3.09-3.12

Brinker International Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.07561.11491.06321.2651.11030.9530.94350.91870.83710
GMI 0.9710.97660.98550.9850.9760.98020.9710.97780.9961.0284
AQI 1.08521.07880.99731.01230.9740.97330.99541.15411.14131.1013
SGI 1.00811.01371.0211.02981.03711.03981.03191.04021.04251.0473
DEPI 0.96190.98670.98710.97710.96250.93930.92490.96530.95690.9498
SGAI 0.86840.88310.96130.96040.9750.99030.97210.98080.95810.9101
LVGI 1.11591.15171.08021.07451.0991.09581.11081.10771.11511.1504
TATA -0.0951-0.1213-0.1396-0.149-0.1408-0.1332-0.1212-0.0955-0.1012-0.1338
M-score -2.85-2.94-3.09-2.93-3.06-3.17-3.13-2.95-3.05-3.97
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