Switch to:
eBay Inc (NAS:EBAY)
Beneish M-Score
-2.78 (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.

eBay Inc has a M-score of -2.78 suggests that the company is not a manipulator.

EBAY' s Beneish M-Score Range Over the Past 10 Years
Min: -3.58   Max: -1.72
Current: -2.78

-3.58
-1.72

During the past 13 years, the highest Beneish M-Score of eBay Inc was -1.72. The lowest was -3.58. And the median was -2.64.


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 eBay 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 * 1.0151+0.528 * 1.0257+0.404 * 0.9648+0.892 * 1.0364+0.115 * 0.999
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9345+4.679 * -0.0827-0.327 * 0.902
=-2.78

* 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 $626 Mil.
Revenue was 2217 + 2230 + 2137 + 2322 = $8,906 Mil.
Gross Profit was 1719 + 1737 + 1660 + 1829 = $6,945 Mil.
Total Current Assets was $9,783 Mil.
Total Assets was $20,502 Mil.
Property, Plant and Equipment(Net PPE) was $1,526 Mil.
Depreciation, Depletion and Amortization(DDA) was $677 Mil.
Selling, General & Admin. Expense(SGA) was $3,266 Mil.
Total Current Liabilities was $3,763 Mil.
Long-Term Debt was $7,582 Mil.
Net Income was 413 + 435 + 482 + 477 = $1,807 Mil.
Non Operating Income was 0 + 0 + 0 + 256 = $256 Mil.
Cash Flow from Operations was 802 + 763 + 641 + 1040 = $3,246 Mil.
Accounts Receivable was $595 Mil.
Revenue was 2099 + 2110 + 2061 + 2323 = $8,593 Mil.
Gross Profit was 1666 + 1676 + 1650 + 1881 = $6,873 Mil.
Total Current Assets was $8,280 Mil.
Total Assets was $18,338 Mil.
Property, Plant and Equipment(Net PPE) was $1,535 Mil.
Depreciation, Depletion and Amortization(DDA) was $680 Mil.
Selling, General & Admin. Expense(SGA) was $3,372 Mil.
Total Current Liabilities was $4,436 Mil.
Long-Term Debt was $6,814 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)
=(626 / 8906) / (595 / 8593)
=0.07028969 / 0.06924241
=1.0151

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)
=(6873 / 8593) / (6945 / 8906)
=0.79983708 / 0.77981136
=1.0257

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 - (9783 + 1526) / 20502) / (1 - (8280 + 1535) / 18338)
=0.44839528 / 0.4647726
=0.9648

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
=8906 / 8593
=1.0364

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))
=(680 / (680 + 1535)) / (677 / (677 + 1526))
=0.30699774 / 0.30730822
=0.999

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)
=(3266 / 8906) / (3372 / 8593)
=0.36671907 / 0.39241243
=0.9345

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)
=((7582 + 3763) / 20502) / ((6814 + 4436) / 18338)
=0.55336065 / 0.61348021
=0.902

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
=(1807 - 256 - 3246) / 20502
=-0.0827

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.

eBay Inc has a M-score of -2.78 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.

eBay Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.51870.9510.81350.91641.04751.19670.9981.86390.62691.0554
GMI 1.0391.0251.0421.03250.99431.02421.00370.85491.01051.0213
AQI 0.84240.83121.12160.90210.92141.07330.76671.04681.01871.2323
SGI 1.31131.28521.11331.02181.04911.27261.20770.58681.06460.9775
DEPI 0.90811.01030.93120.98331.15671.02680.98811.68470.61351.0261
SGAI 1.07950.92280.83971.12260.87930.97940.97651.15041.03471.0409
LVGI 1.48171.08081.1780.83261.3751.11131.3410.99621.33360.9424
TATA -0.0832-0.1492-0.0707-0.0282-0.0394-0.0548-0.0365-0.0542-0.1253-0.1444
M-score -3.26-3.04-2.85-2.66-2.70-2.30-2.67-2.31-3.50-3.00

eBay Inc Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 1.71912.09080.42930.71560.90070.66541.54151.04560.93311.0151
GMI 0.85010.78141.11291.04841.0151.10380.92730.9771.02431.0257
AQI 1.2371.04221.01870.89720.78831.29221.23231.25021.36710.9648
SGI 0.59890.46781.55481.21270.96081.18440.66930.81491.01671.0364
DEPI 1.78786.72640.61351.55361.44740.1591.02610.42630.40150.999
SGAI 1.20441.36130.90780.98751.07050.95251.18651.06520.92250.9345
LVGI 1.26951.32961.33361.11091.0031.14470.94241.04361.07970.902
TATA -0.1426-0.1346-0.1253-0.0597-0.0643-0.1301-0.1444-0.1121-0.0727-0.0827
M-score -2.86-2.19-3.17-2.82-2.95-3.20-2.91-3.13-2.79-2.78
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK