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Guess? Inc (NYSE:GES)
Beneish M-Score
-2.96 (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.

Guess? Inc has a M-score of -2.96 suggests that the company is not a manipulator.

GES' s 10-Year Beneish M-Score Range
Min: -4.39   Max: -1.08
Current: -2.96

-4.39
-1.08

During the past 13 years, the highest Beneish M-Score of Guess? Inc was -1.08. The lowest was -4.39. And the median was -2.83.


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 Guess? 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 * 0.7752+0.528 * 1.0399+0.404 * 1.099+0.892 * 0.9334+0.115 * 0.8608
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0559+4.679 * -0.0546-0.327 * 0.9674
=-2.96

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

This Year (Apr15) TTM:Last Year (Apr14) TTM:
Accounts Receivable was $173 Mil.
Revenue was 478.824 + 696.727 + 589.834 + 608.571 = $2,374 Mil.
Gross Profit was 165.485 + 260.919 + 213.958 + 216.777 = $857 Mil.
Total Current Assets was $1,073 Mil.
Total Assets was $1,555 Mil.
Property, Plant and Equipment(Net PPE) was $250 Mil.
Depreciation, Depletion and Amortization(DDA) was $82 Mil.
Selling, General & Admin. Expense(SGA) was $725 Mil.
Total Current Liabilities was $285 Mil.
Long-Term Debt was $2 Mil.
Net Income was 3.341 + 53.929 + 20.788 + 21.954 = $100 Mil.
Non Operating Income was 2.626 + 6.897 + 7.484 + 4.766 = $22 Mil.
Cash Flow from Operations was 9.135 + 158.71 + -35.247 + 30.596 = $163 Mil.
Accounts Receivable was $240 Mil.
Revenue was 522.541 + 768.363 + 613.497 + 639.012 = $2,543 Mil.
Gross Profit was 176.231 + 301.949 + 228.227 + 248.532 = $955 Mil.
Total Current Assets was $1,158 Mil.
Total Assets was $1,714 Mil.
Property, Plant and Equipment(Net PPE) was $323 Mil.
Depreciation, Depletion and Amortization(DDA) was $87 Mil.
Selling, General & Admin. Expense(SGA) was $736 Mil.
Total Current Liabilities was $320 Mil.
Long-Term Debt was $7 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)
=(173.478 / 2373.956) / (239.769 / 2543.413)
=0.07307549 / 0.09427057
=0.7752

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)
=(260.919 / 2543.413) / (165.485 / 2373.956)
=0.37545574 / 0.36105935
=1.0399

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 - (1073.098 + 249.784) / 1555.239) / (1 - (1157.844 + 322.936) / 1713.751)
=0.14940276 / 0.13594215
=1.099

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
=2373.956 / 2543.413
=0.9334

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))
=(87.257 / (87.257 + 322.936)) / (81.994 / (81.994 + 249.784))
=0.21272182 / 0.24713513
=0.8608

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)
=(724.897 / 2373.956) / (735.549 / 2543.413)
=0.30535402 / 0.28919763
=1.0559

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)
=((2.335 + 284.544) / 1555.239) / ((6.912 + 319.85) / 1713.751)
=0.18445975 / 0.19067064
=0.9674

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
=(100.012 - 21.773 - 163.194) / 1555.239
=-0.0546

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.

Guess? Inc has a M-score of -2.96 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.

Guess? Inc Annual Data

Dec05Dec06Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15
DSRI 1.18141.28871.29150.8621.08581.05910.87920.96470.80230.8471
GMI 0.92340.92840.96731.02790.99641.00921.0121.07911.05671.0582
AQI 1.38541.05840.87790.88030.94421.24611.02691.1520.86721.1352
SGI 1.28361.26611.47651.19631.01681.16861.08070.9890.96660.9408
DEPI 1.22361.03091.04310.83381.07391.13780.95570.91950.94110.8669
SGAI 0.9950.92371.00250.98530.99831.00731.01681.07190.96731.0642
LVGI 1.040.84490.93680.83190.82711.13070.88720.9840.93240.8991
TATA -0.2111-0.10130.0063-0.003-0.0778-0.0435-0.0542-0.056-0.1047-0.0483
M-score -2.92-2.40-1.80-2.44-2.71-2.40-2.73-2.70-3.18-2.81

Guess? Inc Quarterly Data

Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14Jan15Apr15
DSRI 0.96470.76160.81220.77960.80230.98680.8480.83260.84710.7752
GMI 1.07911.09771.07291.06331.05671.04331.06161.05411.05821.0399
AQI 1.1521.01230.84140.82910.86721.01321.05041.0991.13521.099
SGI 0.9890.98250.99950.99890.96660.96770.95480.95140.94080.9334
DEPI 0.91950.88220.92240.93380.94110.98240.95660.90670.86690.8608
SGAI 1.07191.0380.99430.96910.96730.97391.01061.0441.06421.0559
LVGI 0.9840.99630.96030.93730.93240.88240.9330.89660.89910.9674
TATA -0.056-0.0694-0.1026-0.0959-0.1047-0.0923-0.0812-0.0532-0.0483-0.0546
M-score -2.70-3.00-3.15-3.15-3.18-2.88-2.97-2.84-2.81-2.96
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