Switch to:
Ensco PLC (NYSE:ESV)
Beneish M-Score
-4.67 (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 -4.67 suggests that the company is not a manipulator.

ESV' s 10-Year Beneish M-Score Range
Min: -3.19   Max: -1.02
Current: -4.67

-3.19
-1.02

During the past 13 years, the highest Beneish M-Score of Ensco PLC was -1.02. The lowest was -3.19. And the median was -2.45.


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 * 0.9888+0.528 * 1.0057+0.404 * 0.1974+0.892 * 1.0425+0.115 * 0.7803
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8618+4.679 * -0.3712-0.327 * 1.4699
=-4.67

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $867 Mil.
Revenue was 970.4 + 1261.2 + 1203 + 1187 = $4,622 Mil.
Gross Profit was 553.5 + 729.8 + 627 + 582.6 = $2,493 Mil.
Total Current Assets was $2,935 Mil.
Total Assets was $16,060 Mil.
Property, Plant and Equipment(Net PPE) was $12,535 Mil.
Depreciation, Depletion and Amortization(DDA) was $530 Mil.
Selling, General & Admin. Expense(SGA) was $132 Mil.
Total Current Liabilities was $1,105 Mil.
Long-Term Debt was $5,886 Mil.
Net Income was -3451.8 + 429.4 + -1172.7 + 292.5 = $-3,903 Mil.
Non Operating Income was 0 + -3.5 + 2.1 + 1.9 = $1 Mil.
Cash Flow from Operations was 472.6 + 596 + 572.7 + 416.6 = $2,058 Mil.
Accounts Receivable was $841 Mil.
Revenue was 990.6 + 1162.2 + 1130.3 + 1149.9 = $4,433 Mil.
Gross Profit was 584.8 + 627.9 + 603.1 + 589.1 = $2,405 Mil.
Total Current Assets was $1,535 Mil.
Total Assets was $19,473 Mil.
Property, Plant and Equipment(Net PPE) was $14,311 Mil.
Depreciation, Depletion and Amortization(DDA) was $468 Mil.
Selling, General & Admin. Expense(SGA) was $147 Mil.
Total Current Liabilities was $1,047 Mil.
Long-Term Debt was $4,719 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)
=(867.4 / 4621.6) / (841.4 / 4433)
=0.18768392 / 0.18980374
=0.9888

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)
=(729.8 / 4433) / (553.5 / 4621.6)
=0.54249944 / 0.53940194
=1.0057

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 - (2934.8 + 12534.8) / 16059.9) / (1 - (1535.2 + 14311) / 19472.9)
=0.03675614 / 0.18624345
=0.1974

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
=4621.6 / 4433
=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))
=(467.8 / (467.8 + 14311)) / (530 / (530 + 12534.8))
=0.03165345 / 0.04056702
=0.7803

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)
=(131.9 / 4621.6) / (146.8 / 4433)
=0.0285399 / 0.03311527
=0.8618

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)
=((5885.6 + 1104.6) / 16059.9) / ((4718.9 + 1047.3) / 19472.9)
=0.435258 / 0.29611409
=1.4699

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
=(-3902.6 - 0.5 - 2057.9) / 16059.9
=-0.3712

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 -4.67 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.03930.73610.95841.09910.85210.74592.23950.65811.03030.9764
GMI 0.7890.82351.00330.98951.09791.12161.15530.91220.96151.0085
AQI 0.86940.85891.08390.98930.95580.87592.64710.93880.93560.1974
SGI 1.41431.71111.18011.1460.78910.88631.67111.53721.00531.0558
DEPI 0.95910.9791.06461.01191.14071.02761.58250.74281.22770.7803
SGAI 0.68360.81451.13040.7891.50741.51781.10230.61070.98070.851
LVGI 0.87360.818910.75290.91320.75964.15310.89860.94981.4699
TATA -0.0197-0.043-0.0580.0014-0.0707-0.0363-0.0085-0.0556-0.0223-0.3712
M-score -2.24-2.35-2.61-2.14-3.14-2.98-1.02-2.58-2.55-4.66

Ensco PLC Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 0.67990.65810.83030.96440.8451.00480.94750.90541.06910.9888
GMI 0.95830.91220.92810.95420.99120.97410.98590.98980.9671.0057
AQI 0.93750.93880.93740.94440.93320.93560.94671.02410.96440.1974
SGI 1.8731.53721.28151.13261.08541.03081.00911.01191.02521.0425
DEPI 0.84190.74280.80160.92460.95681.22771.22071.00790.95020.7803
SGAI 0.58310.61070.69510.85210.87590.95650.98170.97170.92360.8618
LVGI 0.9020.89860.89050.9060.94360.94980.95711.05661.19831.4699
TATA -0.0413-0.0556-0.0419-0.0362-0.0375-0.0223-0.0271-0.1231-0.1082-0.3712
M-score -2.15-2.58-2.58-2.56-2.72-2.54-2.63-3.14-2.99-4.67
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)
Free 7-day Trial
FEEDBACK