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Goodyear Tire & Rubber Co (NAS:GT)
Beneish M-Score
-2.43 (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 -2.43 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: -2.43

-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 * 1.0948+0.528 * 0.957+0.404 * 1.2362+0.892 * 0.925+0.115 * 1.0349
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0704+4.679 * -0.0068-0.327 * 1.0091
=-2.43

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

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $2,649 Mil.
Revenue was 3847 + 3879 + 3691 + 4063 = $15,480 Mil.
Gross Profit was 1111 + 1066 + 990 + 992 = $4,159 Mil.
Total Current Assets was $6,571 Mil.
Total Assets was $17,143 Mil.
Property, Plant and Equipment(Net PPE) was $7,039 Mil.
Depreciation, Depletion and Amortization(DDA) was $712 Mil.
Selling, General & Admin. Expense(SGA) was $2,585 Mil.
Total Current Liabilities was $4,800 Mil.
Long-Term Debt was $5,446 Mil.
Net Income was 317 + 202 + 184 + -380 = $323 Mil.
Non Operating Income was 19 + -72 + -21 + -775 = $-849 Mil.
Cash Flow from Operations was 357 + 261 + -381 + 1052 = $1,289 Mil.
Accounts Receivable was $2,616 Mil.
Revenue was 4184 + 4172 + 4024 + 4356 = $16,736 Mil.
Gross Profit was 1184 + 1145 + 958 + 1016 = $4,303 Mil.
Total Current Assets was $7,922 Mil.
Total Assets was $17,515 Mil.
Property, Plant and Equipment(Net PPE) was $6,673 Mil.
Depreciation, Depletion and Amortization(DDA) was $701 Mil.
Selling, General & Admin. Expense(SGA) was $2,611 Mil.
Total Current Liabilities was $4,783 Mil.
Long-Term Debt was $5,591 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)
=(2649 / 15480) / (2616 / 16736)
=0.17112403 / 0.15630975
=1.0948

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)
=(4303 / 16736) / (4159 / 15480)
=0.25711042 / 0.26866925
=0.957

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 - (6571 + 7039) / 17143) / (1 - (7922 + 6673) / 17515)
=0.20608995 / 0.16671424
=1.2362

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
=15480 / 16736
=0.925

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))
=(701 / (701 + 6673)) / (712 / (712 + 7039))
=0.09506374 / 0.09185911
=1.0349

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)
=(2585 / 15480) / (2611 / 16736)
=0.16698966 / 0.15601099
=1.0704

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)
=((5446 + 4800) / 17143) / ((5591 + 4783) / 17515)
=0.59767835 / 0.59229232
=1.0091

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
=(323 - -849 - 1289) / 17143
=-0.0068

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 -2.43 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.

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 0.92940.78951.01861.10610.97550.90031.09410.99642.31931.0289
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 1.01040.79341.11880.98151.07220.98720.98941.06110.95041.0086
TATA -0.05660.03680.0518-0.1121-0.0603-0.0193-0.0292-0.00640.1406-0.0435
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

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 1.04580.98940.94060.93770.95810.9611.05481.08041.08761.0948
GMI 0.85920.86120.90320.90550.90370.9040.89660.89530.92520.957
AQI 1.0831.04652.31931.9281.84441.83041.02891.1631.18421.2362
SGI 0.94330.93830.92820.92360.90970.90110.90650.91050.91910.925
DEPI 1.01540.9750.96710.94770.9670.9890.99421.04271.02781.0349
SGAI 1.09631.07551.06251.03631.02991.05211.0351.05621.04341.0704
LVGI 1.04411.05570.95040.84830.86680.85841.00861.02281.02421.0091
TATA 0.03640.03790.14060.06950.06140.0534-0.0397-0.0262-0.0087-0.0068
M-score -2.39-2.46-1.46-1.92-1.99-2.03-2.75-2.61-2.49-2.43
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