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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.
During the past 13 years, the highest Beneish M-Score of Iconix Brand Group Inc was 7.80. The lowest was -4.41. And the median was -2.39.
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 Iconix Brand Group 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 * 0.8447||+||0.528 * 1||+||0.404 * 0.9101||+||0.892 * 0.9717||+||0.115 * 1.4291|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 1.0306||+||4.679 * -0.1932||-||0.327 * 1.0971|
|This Year (Dec16) TTM:||Last Year (Dec15) TTM:|
|Accounts Receivable was $85.2 Mil.|
Revenue was 87.142 + 90.944 + 95.743 + 94.632 = $368.5 Mil.
Gross Profit was 87.142 + 90.944 + 95.743 + 94.632 = $368.5 Mil.
Total Current Assets was $444.1 Mil.
Total Assets was $2,005.5 Mil.
Property, Plant and Equipment(Net PPE) was $9.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $3.5 Mil.
Selling, General & Admin. Expense(SGA) was $206.6 Mil.
Total Current Liabilities was $254.1 Mil.
Long-Term Debt was $1,093.7 Mil.
Net Income was -297.546 + 15.216 + 11.582 + 18.616 = $-252.1 Mil.
Non Operating Income was -5.693 + 13.615 + 4.968 + 0.2 = $13.1 Mil.
Cash Flow from Operations was 43.248 + 20.243 + 26.634 + 32.051 = $122.2 Mil.
|Accounts Receivable was $103.8 Mil.
Revenue was 94.653 + 91.332 + 97.398 + 95.814 = $379.2 Mil.
Gross Profit was 94.653 + 91.332 + 97.398 + 95.814 = $379.2 Mil.
Total Current Assets was $367.4 Mil.
Total Assets was $2,504.6 Mil.
Property, Plant and Equipment(Net PPE) was $7.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.7 Mil.
Selling, General & Admin. Expense(SGA) was $206.3 Mil.
Total Current Liabilities was $145.9 Mil.
Long-Term Debt was $1,388.3 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(85.187 / 368.461)||/||(103.792 / 379.197)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(379.197 / 379.197)||/||(368.461 / 368.461)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (444.141 + 9.345) / 2005.515)||/||(1 - (367.423 + 7.499) / 2504.601)|
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.
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))|
|=||(4.719 / (4.719 + 7.499))||/||(3.461 / (3.461 + 9.345))|
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)|
|=||(206.588 / 368.461)||/||(206.286 / 379.197)|
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)|
|=||((1093.725 + 254.073) / 2005.515)||/||((1388.269 + 145.917) / 2504.601)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(-252.132 - 13.09||-||122.176)||/||2005.515|
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.
Iconix Brand Group Inc has a M-score of -3.58 suggests that the company will not be a manipulator.
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
Iconix Brand Group Inc Annual Data
Iconix Brand Group Inc Quarterly Data