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Starbucks Corp (FRA:SRB)
Beneish M-Score
-1.62 (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.

Starbucks Corp has a M-score of -1.63 signals that the company is a manipulator.

FRA:SRB' s 10-Year Beneish M-Score Range
Min: -3.99   Max: -1.62
Current: -1.62

-3.99
-1.62

During the past 13 years, the highest Beneish M-Score of Starbucks Corp was -1.62. The lowest was -3.99. And the median was -2.97.


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 Starbucks Corp 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 * 1.0792+0.528 * 0.9787+0.404 * 1.154+0.892 * 1.0786+0.115 * 1.0188
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9735+4.679 * 0.1264-0.327 * 0.816
=-1.63

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was €490 Mil.
Revenue was 3243.36695112 + 3056.43855776 + 2801.01229212 + 3090.08746356 = €12,191 Mil.
Gross Profit was 1906.59425912 + 1797.05665931 + 1622.99349241 + 1781.70553936 = €7,108 Mil.
Total Current Assets was €3,234 Mil.
Total Assets was €8,342 Mil.
Property, Plant and Equipment(Net PPE) was €2,730 Mil.
Depreciation, Depletion and Amortization(DDA) was €555 Mil.
Selling, General & Admin. Expense(SGA) was €4,171 Mil.
Total Current Liabilities was €2,357 Mil.
Long-Term Debt was €1,589 Mil.
Net Income was 456.012412723 + 377.189109639 + 308.749096168 + 394.096209913 = €1,536 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = €0 Mil.
Cash Flow from Operations was 575.01939488 + 625.5334805 + 302.530730296 + -1021.79300292 = €481 Mil.
Accounts Receivable was €421 Mil.
Revenue was 2837.97752809 + 2831.91811979 + 2741.003861 + 2891.15853659 = €11,302 Mil.
Gross Profit was 1614.23220974 + 1620.6974981 + 1559.22779923 + 1655.86890244 = €6,450 Mil.
Total Current Assets was €4,098 Mil.
Total Assets was €8,627 Mil.
Property, Plant and Equipment(Net PPE) was €2,397 Mil.
Depreciation, Depletion and Amortization(DDA) was €498 Mil.
Selling, General & Admin. Expense(SGA) was €3,972 Mil.
Total Current Liabilities was €4,028 Mil.
Long-Term Debt was €973 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)
=(489.526764934 / 12190.9052646) / (420.524344569 / 11302.0580455)
=0.04015508 / 0.03720777
=1.0792

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)
=(1797.05665931 / 11302.0580455) / (1906.59425912 / 12190.9052646)
=0.57069486 / 0.58308631
=0.9787

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 - (3234.05740884 + 2730.02327386) / 8342.0480993) / (1 - (4098.42696629 + 2397.37827715) / 8626.74157303)
=0.28505798 / 0.2470152
=1.154

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
=12190.9052646 / 11302.0580455
=1.0786

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))
=(498.341903104 / (498.341903104 + 2397.37827715)) / (554.860735938 / (554.860735938 + 2730.02327386))
=0.17209601 / 0.16891334
=1.0188

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)
=(4170.51684496 / 12190.9052646) / (3971.85823841 / 11302.0580455)
=0.34210067 / 0.35142787
=0.9735

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)
=((1589.06128782 + 2357.40884407) / 8342.0480993) / ((973.333333333 + 4027.94007491) / 8626.74157303)
=0.47308168 / 0.57974072
=0.816

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
=(1536.04682844 - 0 - 481.290602761) / 8342.0480993
=0.1264

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.

Starbucks Corp has a M-score of -1.63 signals that the company is likely to 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.

Starbucks Corp Annual Data

Sep05Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14
DSRI 1.13080.96161.06211.03740.87371.01971.16851.1061.03361.0159
GMI 0.97971.03180.91360.42230.99120.9491.01321.03020.98630.9789
AQI 0.92021.04891.02641.20491.05541.05450.86581.00661.49211.154
SGI 1.20311.17451.10521.06940.92661.21831.04111.21341.07931.1458
DEPI 1.02051.10811.0550.85670.93410.99380.96591.05641.05420.9694
SGAI 0.97551.08341.37034.8610.98060.98310.95190.95570.99020.974
LVGI 1.58071.24991.15730.95380.7910.95450.97820.94131.72680.816
TATA -0.1438-0.1493-0.1435-0.1663-0.179-0.1268-0.0656-0.0446-0.25180.1358
M-score -3.08-3.11-3.14-4.05-3.42-2.85-2.63-2.35-3.59-1.59

Starbucks Corp Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 1.17311.10450.91421.03360.99221.01391.10290.99931.04531.0792
GMI 1.04691.03051.01110.99760.98720.98640.98850.98840.98580.9787
AQI 0.98251.00661.00541.3671.29951.49211.98181.47691.73741.154
SGI 1.17231.21511.19451.17331.12251.10021.08991.06311.06431.0786
DEPI 1.06661.05511.01671.05651.0311.03751.02090.98860.9931.0188
SGAI 0.93840.95610.97250.97590.99050.99040.97820.98060.97350.9735
LVGI 0.91060.94131.0021.05311.06191.72681.4081.42821.44710.816
TATA -0.0424-0.0485-0.1099-0.1215-0.1181-0.2528-0.0376-0.0466-0.05250.1264
M-score -2.30-2.37-2.89-2.72-2.83-3.60-2.22-2.59-2.48-1.63
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