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Iconix Brand Group, Inc. (NAS:ICON)
Beneish M-Score
-2.65 (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.

Iconix Brand Group, Inc. has a M-score of -2.65 suggests that the company is not a manipulator.

ICON' s 10-Year Beneish M-Score Range
Min: -4.41   Max: 7.83
Current: -2.65

-4.41
7.83

During the past 13 years, the highest Beneish M-Score of Iconix Brand Group, Inc. was 7.83. The lowest was -4.41. And the median was -2.39.


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 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 * 0.9708+0.528 * 1+0.404 * 0.9787+0.892 * 1.2227+0.115 * 0.8457
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0356+4.679 * -0.0409-0.327 * 1.3498
=-2.65

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $101.2 Mil.
Revenue was 105.264 + 107.175 + 115.125 + 105.062 = $432.6 Mil.
Gross Profit was 105.264 + 107.175 + 115.125 + 105.062 = $432.6 Mil.
Total Current Assets was $476.6 Mil.
Total Assets was $2,860.2 Mil.
Property, Plant and Equipment(Net PPE) was $8.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $10.1 Mil.
Selling, General & Admin. Expense(SGA) was $175.2 Mil.
Total Current Liabilities was $127.9 Mil.
Long-Term Debt was $1,366.1 Mil.
Net Income was 26.146 + 28.997 + 38.716 + 34.189 = $128.0 Mil.
Non Operating Income was 4.541 + 3.388 + 2.264 + 1.936 = $12.1 Mil.
Cash Flow from Operations was 76.788 + 51.688 + 50.803 + 53.51 = $232.8 Mil.
Accounts Receivable was $85.2 Mil.
Revenue was 85.131 + 86.59 + 93.646 + 88.451 = $353.8 Mil.
Gross Profit was 85.131 + 86.59 + 93.646 + 88.451 = $353.8 Mil.
Total Current Assets was $366.4 Mil.
Total Assets was $2,481.7 Mil.
Property, Plant and Equipment(Net PPE) was $10.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $8.3 Mil.
Selling, General & Admin. Expense(SGA) was $138.4 Mil.
Total Current Liabilities was $100.6 Mil.
Long-Term Debt was $859.7 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)
=(101.19 / 432.626) / (85.249 / 353.818)
=0.23389718 / 0.24094026
=0.9708

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)
=(107.175 / 353.818) / (105.264 / 432.626)
=1 / 1
=1

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 - (476.628 + 8.837) / 2860.194) / (1 - (366.351 + 10.09) / 2481.738)
=0.83026851 / 0.84831558
=0.9787

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
=432.626 / 353.818
=1.2227

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))
=(8.312 / (8.312 + 10.09)) / (10.13 / (10.13 + 8.837))
=0.45169003 / 0.53408552
=0.8457

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)
=(175.215 / 432.626) / (138.368 / 353.818)
=0.4050034 / 0.39107112
=1.0356

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)
=((1366.069 + 127.858) / 2860.194) / ((859.718 + 100.61) / 2481.738)
=0.52231667 / 0.38695785
=1.3498

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
=(128.048 - 12.129 - 232.789) / 2860.194
=-0.0409

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 -2.65 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.

Iconix Brand Group, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.96351.34591.55981.01171.11361.2440.72941.09361.11850.9708
GMI 0.7280.300811111111
AQI 1.28371.07070.95681.0850.97320.93161.04540.98210.98280.9787
SGI 0.52510.43722.67591.98281.35471.07061.43311.11210.95671.2227
DEPI 0.96681.25430.98720.79011.23371.28691.12891.07731.00870.8457
SGAI 1.04461.79170.66040.911.23131.00421.21810.91511.02591.0356
LVGI 0.80490.87390.49072.14490.85560.83720.85310.93881.24131.3498
TATA -0.20730.0240.0047-0.0194-0.0185-0.0261-0.0304-0.0286-0.0427-0.0409
M-score -3.88-2.96-0.24-2.03-2.12-2.26-2.44-2.39-2.70-2.65

Iconix Brand Group, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.05421.09361.16191.10490.87741.11851.28781.40811.25510.9708
GMI 1111111111
AQI 0.92870.98210.96971.10141.09960.98280.94730.85950.91180.9787
SGI 1.16721.11211.0361.01041.00530.95671.01231.05841.13261.2227
DEPI 1.09841.07731.04341.01021.01441.00870.94450.93970.88380.8457
SGAI 1.07790.91510.91090.9210.97381.02591.03321.02691.04311.0356
LVGI 0.94170.93881.02770.79890.78581.24131.47351.99662.11051.3498
TATA -0.0211-0.0286-0.0297-0.0388-0.0494-0.0427-0.0358-0.028-0.0313-0.0409
M-score -2.39-2.39-2.44-2.43-2.70-2.70-2.56-2.58-2.69-2.65
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