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Goodyear Tire & Rubber Co (NAS:GT)
Beneish M-Score
-2.63 (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.

Goodyear Tire & Rubber Co has a M-score of -2.63 suggests that the company is not a manipulator.

GT' s Beneish M-Score Range Over the Past 10 Years
Min: -3.27   Max: -1.46
Current: -2.63

-3.27
-1.46

During the past 13 years, the highest Beneish M-Score of Goodyear Tire & Rubber Co was -1.46. The lowest was -3.27. And the median was -2.60.


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 Goodyear Tire & Rubber Co 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 * 1.0804+0.528 * 0.8953+0.404 * 1.163+0.892 * 0.9105+0.115 * 1.0427
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0818+4.679 * -0.0302-0.327 * 1.0228
=-2.63

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $2,482 Mil.
Revenue was 3691 + 4063 + 4184 + 4172 = $16,110 Mil.
Gross Profit was 990 + 992 + 1184 + 1145 = $4,311 Mil.
Total Current Assets was $6,375 Mil.
Total Assets was $16,777 Mil.
Property, Plant and Equipment(Net PPE) was $6,940 Mil.
Depreciation, Depletion and Amortization(DDA) was $700 Mil.
Selling, General & Admin. Expense(SGA) was $2,621 Mil.
Total Current Liabilities was $4,601 Mil.
Long-Term Debt was $5,685 Mil.
Net Income was 184 + -380 + 271 + 192 = $267 Mil.
Non Operating Income was -21 + -682 + -25 + -67 = $-795 Mil.
Cash Flow from Operations was -381 + 1052 + 361 + 536 = $1,568 Mil.
Accounts Receivable was $2,523 Mil.
Revenue was 4024 + 4356 + 4657 + 4656 = $17,693 Mil.
Gross Profit was 958 + 1016 + 1141 + 1124 = $4,239 Mil.
Total Current Assets was $7,434 Mil.
Total Assets was $17,336 Mil.
Property, Plant and Equipment(Net PPE) was $6,826 Mil.
Depreciation, Depletion and Amortization(DDA) was $721 Mil.
Selling, General & Admin. Expense(SGA) was $2,661 Mil.
Total Current Liabilities was $4,427 Mil.
Long-Term Debt was $5,965 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)
=(2482 / 16110) / (2523 / 17693)
=0.1540658 / 0.14259877
=1.0804

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)
=(992 / 17693) / (990 / 16110)
=0.23958628 / 0.26759777
=0.8953

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 - (6375 + 6940) / 16777) / (1 - (7434 + 6826) / 17336)
=0.20635394 / 0.17743424
=1.163

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
=16110 / 17693
=0.9105

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))
=(721 / (721 + 6826)) / (700 / (700 + 6940))
=0.09553465 / 0.09162304
=1.0427

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)
=(2621 / 16110) / (2661 / 17693)
=0.16269398 / 0.15039846
=1.0818

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)
=((5685 + 4601) / 16777) / ((5965 + 4427) / 17336)
=0.61310127 / 0.59944624
=1.0228

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
=(267 - -795 - 1568) / 16777
=-0.0302

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.

Goodyear Tire & Rubber Co has a M-score of -2.63 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.

Goodyear Tire & Rubber Co Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.85581.05780.81761.20640.93240.86130.97571.02070.94061.0548
GMI 1.22440.84611.10581.06720.89721.03550.95020.86550.90320.8966
AQI 0.92940.78951.01861.10610.97550.90031.09410.99642.31931.0356
SGI 1.03611.04760.99210.83651.15531.2090.9220.93080.92820.9065
DEPI 0.98921.15970.94261.06821.02630.94841.12191.00120.96710.9942
SGAI 1.04410.92280.94891.20980.86530.88751.04461.09011.06251.0601
LVGI 1.01040.79341.11880.98151.07220.98720.98941.06110.95041.0105
TATA -0.05660.03680.0518-0.1121-0.0603-0.0193-0.0292-0.00640.1406-0.0434
M-score -2.77-2.28-2.39-2.90-2.75-2.52-2.69-2.66-1.46-2.77

Goodyear Tire & Rubber Co Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.02071.02241.04580.98940.94060.93770.95810.9611.05481.0804
GMI 0.86550.86590.85920.86120.90320.90550.90370.9040.89660.8953
AQI 0.99641.06051.0831.04652.31931.9281.84441.83041.03561.163
SGI 0.93080.94310.94330.93830.92820.92360.90970.90110.90650.9105
DEPI 1.00121.00931.01540.9750.96710.94770.9670.9890.99421.0427
SGAI 1.09011.09141.09631.07551.06251.03631.02991.04411.06011.0818
LVGI 1.06111.05971.04411.05570.95040.84830.86680.85841.01051.0228
TATA -0.00790.02730.03640.03790.14060.06950.06160.055-0.0436-0.0302
M-score -2.67-2.46-2.39-2.46-1.46-1.92-1.99-2.02-2.77-2.63
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