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Ensco PLC (NYSE:ESV)
Beneish M-Score
-4.16 (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.

Ensco PLC has a M-score of -4.16 suggests that the company is not a manipulator.

ESV' s Beneish M-Score Range Over the Past 10 Years
Min: -4.66   Max: 0.02
Current: -4.16

-4.66
0.02

During the past 13 years, the highest Beneish M-Score of Ensco PLC was 0.02. The lowest was -4.66. And the median was -2.56.


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 Ensco PLC 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 * 0.8972+0.528 * 1.0311+0.404 * 0.4026+0.892 * 0.7966+0.115 * 0.8596
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1317+4.679 * -0.2367-0.327 * 1.1066
=-4.16

* 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 $559 Mil.
Revenue was 814 + 828.3 + 1012.2 + 1059 = $3,714 Mil.
Gross Profit was 450.3 + 413.1 + 578.7 + 556.4 = $1,999 Mil.
Total Current Assets was $2,323 Mil.
Total Assets was $13,610 Mil.
Property, Plant and Equipment(Net PPE) was $11,097 Mil.
Depreciation, Depletion and Amortization(DDA) was $546 Mil.
Selling, General & Admin. Expense(SGA) was $112 Mil.
Total Current Liabilities was $1,507 Mil.
Long-Term Debt was $4,991 Mil.
Net Income was 175.3 + -2471.8 + 292 + 260.3 = $-1,744 Mil.
Non Operating Income was -1.8 + 7 + 1.9 + -7.6 = $-1 Mil.
Cash Flow from Operations was 238.7 + 423.3 + 383.6 + 432 = $1,478 Mil.
Accounts Receivable was $781 Mil.
Revenue was 1163.9 + 1159.8 + 1201.4 + 1136.6 = $4,662 Mil.
Gross Profit was 645.6 + 645.8 + 701.2 + 594.1 = $2,587 Mil.
Total Current Assets was $3,054 Mil.
Total Assets was $16,346 Mil.
Property, Plant and Equipment(Net PPE) was $12,725 Mil.
Depreciation, Depletion and Amortization(DDA) was $535 Mil.
Selling, General & Admin. Expense(SGA) was $124 Mil.
Total Current Liabilities was $1,134 Mil.
Long-Term Debt was $5,919 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)
=(558.5 / 3713.5) / (781.4 / 4661.7)
=0.1503972 / 0.16762125
=0.8972

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)
=(2586.7 / 4661.7) / (1998.5 / 3713.5)
=0.55488341 / 0.53817154
=1.0311

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 - (2322.8 + 11097.1) / 13610) / (1 - (3053.8 + 12725.3) / 16346.2)
=0.01396767 / 0.03469308
=0.4026

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
=3713.5 / 4661.7
=0.7966

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))
=(534.8 / (534.8 + 12725.3)) / (546.3 / (546.3 + 11097.1))
=0.04033152 / 0.04691928
=0.8596

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)
=(111.7 / 3713.5) / (123.9 / 4661.7)
=0.03007944 / 0.02657829
=1.1317

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)
=((4991 + 1507.4) / 13610) / ((5919.3 + 1133.6) / 16346.2)
=0.47747245 / 0.43147031
=1.1066

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
=(-1744.2 - -0.5 - 1477.6) / 13610
=-0.2367

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.

Ensco PLC has a M-score of -4.16 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.

Ensco PLC Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.72710.95681.1020.84680.75822.23380.66860.90541.12570.7606
GMI 0.82991.00161.01131.07361.14591.13420.91321.03280.93891.0094
AQI 0.85891.08390.98930.95580.87592.64710.93880.93560.20590.5051
SGI 1.73231.18211.1430.79410.8721.67531.51291.1440.92780.8902
DEPI 0.98711.06460.99891.07711.07691.58940.7570.98240.97510.8282
SGAI 0.99791.12850.79111.4981.54281.09950.62060.86180.96841.0083
LVGI 0.818910.75290.91320.75964.15310.89860.94981.47111.1229
TATA -0.0388-0.0530.0036-0.0691-0.0424-0.0085-0.0549-0.031-0.3716-0.2399
M-score -2.35-2.59-2.12-3.16-2.99-1.03-2.58-2.55-4.67-4.18

Ensco PLC Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 0.85010.82830.8050.9641.01440.94250.79860.87160.76060.8972
GMI 1.01111.00991.01210.9860.99540.97870.971511.00941.0311
AQI 0.93560.94671.02410.96440.20590.18650.16330.16610.50510.4026
SGI 1.21831.15441.13821.13691.02971.07171.05230.99990.89020.7966
DEPI 0.9561.02460.8040.7620.78030.76080.92350.89340.82820.8596
SGAI 0.80930.85810.86390.83280.87260.78590.75940.83941.00831.1317
LVGI 0.94980.95711.05661.19831.47111.4891.32581.14641.12291.1066
TATA -0.0223-0.028-0.1217-0.1045-0.3716-0.3628-0.2687-0.2656-0.2399-0.2367
M-score -2.50-2.61-3.11-2.97-4.66-4.66-4.30-4.21-4.18-4.16
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