Switch to:
Guess? Inc (NYSE:GES)
Beneish M-Score
-2.82 (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 -2.82 suggests that the company is not a manipulator.

GES' s Beneish M-Score Range Over the Past 10 Years
Min: -3.22   Max: -1.05
Current: -2.82

-3.22
-1.05

During the past 13 years, the highest Beneish M-Score of Guess? Inc was -1.05. The lowest was -3.22. And the median was -2.75.


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 * 1.065+0.528 * 1.0049+0.404 * 1.0306+0.892 * 0.9117+0.115 * 1.1386
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9846+4.679 * -0.0679-0.327 * 1.1125
=-2.82

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

This Year (Jan16) TTM:Last Year (Jan15) TTM:
Accounts Receivable was $223 Mil.
Revenue was 658.259 + 520.964 + 546.264 + 478.824 = $2,204 Mil.
Gross Profit was 240.164 + 183.664 + 198.117 + 165.485 = $787 Mil.
Total Current Assets was $1,036 Mil.
Total Assets was $1,539 Mil.
Property, Plant and Equipment(Net PPE) was $255 Mil.
Depreciation, Depletion and Amortization(DDA) was $71 Mil.
Selling, General & Admin. Expense(SGA) was $666 Mil.
Total Current Liabilities was $327 Mil.
Long-Term Debt was $2 Mil.
Net Income was 47.777 + 12.444 + 18.289 + 3.341 = $82 Mil.
Non Operating Income was 0.256 + 0.247 + 3.708 + 2.626 = $7 Mil.
Cash Flow from Operations was 114.702 + 7.991 + 47.601 + 9.135 = $179 Mil.
Accounts Receivable was $230 Mil.
Revenue was 696.727 + 589.834 + 608.571 + 522.541 = $2,418 Mil.
Gross Profit was 260.919 + 213.958 + 216.777 + 176.231 = $868 Mil.
Total Current Assets was $1,092 Mil.
Total Assets was $1,601 Mil.
Property, Plant and Equipment(Net PPE) was $260 Mil.
Depreciation, Depletion and Amortization(DDA) was $85 Mil.
Selling, General & Admin. Expense(SGA) was $742 Mil.
Total Current Liabilities was $302 Mil.
Long-Term Debt was $6 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)
=(222.972 / 2204.311) / (229.618 / 2417.673)
=0.1011527 / 0.0949748
=1.065

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)
=(183.664 / 2417.673) / (240.164 / 2204.311)
=0.35897535 / 0.35722273
=1.0049

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 - (1036.252 + 255.344) / 1538.748) / (1 - (1092.299 + 259.524) / 1601.405)
=0.16061889 / 0.15585189
=1.0306

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
=2204.311 / 2417.673
=0.9117

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))
=(85.06 / (85.06 + 259.524)) / (70.684 / (70.684 + 255.344))
=0.24684837 / 0.21680346
=1.1386

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)
=(666.08 / 2204.311) / (741.973 / 2417.673)
=0.30217152 / 0.30689551
=0.9846

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)
=((2.318 + 327.059) / 1538.748) / ((6.165 + 301.966) / 1601.405)
=0.21405519 / 0.19241291
=1.1125

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
=(81.851 - 6.837 - 179.429) / 1538.748
=-0.0679

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 -2.82 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

Dec06Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16
DSRI 1.28871.29150.8621.06371.08110.87920.88970.870.96841.065
GMI 0.92840.96731.02790.99641.01651.01161.07161.05671.05821.0049
AQI 1.05840.87790.88030.94351.2471.02691.1520.86721.22911.0306
SGI 1.26611.47651.19631.01681.16861.08070.9890.96660.94080.9117
DEPI 1.03091.04310.83381.07391.13780.95570.91950.94110.86691.1386
SGAI 0.92371.00250.98530.99831.00341.03631.05580.96731.06420.9846
LVGI 0.84490.93680.83190.8291.12810.88720.9840.93240.89911.1125
TATA -0.02340.0063-0.003-0.0777-0.0435-0.0542-0.056-0.1047-0.0483-0.0679
M-score -2.03-1.80-2.44-2.73-2.38-2.73-2.77-3.12-2.66-2.82

Guess? Inc Quarterly Data

Oct13Jan14Apr14Jul14Oct14Jan15Apr15Jul15Oct15Jan16
DSRI 0.77960.870.98680.8480.83260.96840.77520.88650.94571.065
GMI 1.06081.05671.04331.06161.05411.05821.03991.01281.01331.0049
AQI 0.82910.86721.01321.05041.0991.22911.0991.12731.12041.0306
SGI 0.99890.96660.96770.95480.95140.94080.93340.91990.9010.9117
DEPI 0.93380.94110.98240.95660.90670.86690.86080.89020.96951.1386
SGAI 0.94870.96730.97391.01061.0441.06421.05591.04171.00960.9846
LVGI 0.93730.93240.88240.9330.89660.89910.96740.97471.1061.1125
TATA -0.0959-0.1047-0.0923-0.0812-0.0532-0.0483-0.0546-0.0669-0.0978-0.0679
M-score -3.15-3.12-2.88-2.97-2.84-2.66-2.96-2.92-3.06-2.82
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)

GuruFocus Premium Plus Membership

FEEDBACK