Switch to:
GuruFocus has detected 5 Warning Signs with Fifth Third Bancorp $FITB.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Fifth Third Bancorp (NAS:FITB)
Beneish M-Score
-2.52 (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.

Fifth Third Bancorp has a M-score of -2.52 suggests that the company is not a manipulator.

FITB' s Beneish M-Score Range Over the Past 10 Years
Min: -3.52   Max: 2.68
Current: -2.52

-3.52
2.68

During the past 13 years, the highest Beneish M-Score of Fifth Third Bancorp was 2.68. The lowest was -3.52. And the median was -2.58.


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 Fifth Third Bancorp 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+0.528 * 1+0.404 * 1.0012+0.892 * 0.966+0.115 * 0.9359
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0843+4.679 * -0.0039-0.327 * 0.9028
=-2.52

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $0 Mil.
Revenue was 1524 + 1747 + 1501 + 1540 = $6,312 Mil.
Gross Profit was 1524 + 1747 + 1501 + 1540 = $6,312 Mil.
Total Current Assets was $0 Mil.
Total Assets was $142,177 Mil.
Property, Plant and Equipment(Net PPE) was $2,803 Mil.
Depreciation, Depletion and Amortization(DDA) was $453 Mil.
Selling, General & Admin. Expense(SGA) was $2,846 Mil.
Total Current Liabilities was $0 Mil.
Long-Term Debt was $14,388 Mil.
Net Income was 389 + 516 + 333 + 327 = $1,565 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 914 + 498 + 307 + 395 = $2,114 Mil.
Accounts Receivable was $0 Mil.
Revenue was 2000 + 1614 + 1443 + 1477 = $6,534 Mil.
Gross Profit was 2000 + 1614 + 1443 + 1477 = $6,534 Mil.
Total Current Assets was $0 Mil.
Total Assets was $141,048 Mil.
Property, Plant and Equipment(Net PPE) was $2,946 Mil.
Depreciation, Depletion and Amortization(DDA) was $441 Mil.
Selling, General & Admin. Expense(SGA) was $2,717 Mil.
Total Current Liabilities was $0 Mil.
Long-Term Debt was $15,810 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)
=(0 / 6312) / (0 / 6534)
=0 / 0
=1

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)
=(6534 / 6534) / (6312 / 6312)
=1 / 1
=1

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 - (0 + 2803) / 142177) / (1 - (0 + 2946) / 141048)
=0.98028514 / 0.97911349
=1.0012

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
=6312 / 6534
=0.966

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))
=(441 / (441 + 2946)) / (453 / (453 + 2803))
=0.13020372 / 0.13912776
=0.9359

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)
=(2846 / 6312) / (2717 / 6534)
=0.4508872 / 0.41582492
=1.0843

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)
=((14388 + 0) / 142177) / ((15810 + 0) / 141048)
=0.1011978 / 0.1120895
=0.9028

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
=(1565 - 0 - 2114) / 142177
=-0.0039

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.

Fifth Third Bancorp has a M-score of -2.52 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.

Fifth Third Bancorp Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI
GMI
AQI
SGI
DEPI
SGAI
LVGI
TATA
M-score

Fifth Third Bancorp Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 1111111111
GMI 1111111111
AQI 1.0021.0021.00281.00291.00321.00221.00181.00081.00631.0012
SGI 0.87870.89140.91790.93150.99181.07981.08661.13221.11850.966
DEPI 1.3021.17231.0590.93950.86240.88150.90330.95530.73350.9359
SGAI 1.42491.15071.09791.06021.03250.97110.97780.94190.94331.0843
LVGI 1.6581.46121.15490.90631.02411.03881.0741.1841.07740.9028
TATA -0.0061-0.0043-0.0051-0.0047-0.0042-0.005-0.0044-0.0033-0.0019-0.0039
M-score -2.87-2.75-2.64-2.55-2.53-2.45-2.45-2.43-2.43-2.52
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