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InterDigital Inc (NAS:IDCC)
Beneish M-Score
-2.34 (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.

InterDigital Inc has a M-score of -2.34 suggests that the company is not a manipulator.

IDCC' s Beneish M-Score Range Over the Past 10 Years
Min: -4.82   Max: 3.92
Current: -2.34

-4.82
3.92

During the past 13 years, the highest Beneish M-Score of InterDigital Inc was 3.92. The lowest was -4.82. And the median was -2.25.


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 InterDigital 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 * 1.0429+0.528 * 0.8926+0.404 * 1.3055+0.892 * 1.2133+0.115 * 0.9855
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8909+4.679 * -0.0534-0.327 * 0.7678
=-2.34

* 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 $146.9 Mil.
Revenue was 208.307 + 75.915 + 107.764 + 112.098 = $504.1 Mil.
Gross Profit was 182.158 + 47.63 + 80.597 + 82.897 = $393.3 Mil.
Total Current Assets was $974.7 Mil.
Total Assets was $1,442.9 Mil.
Property, Plant and Equipment(Net PPE) was $11.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $51.6 Mil.
Selling, General & Admin. Expense(SGA) was $41.6 Mil.
Total Current Liabilities was $238.2 Mil.
Long-Term Debt was $268.8 Mil.
Net Income was 104.466 + 39.994 + 28.071 + 33.038 = $205.6 Mil.
Non Operating Income was -0.385 + -0.706 + -0.112 + -0.411 = $-1.6 Mil.
Cash Flow from Operations was -10.171 + 191.434 + 16.233 + 86.777 = $284.3 Mil.
Accounts Receivable was $116.1 Mil.
Revenue was 100.408 + 118.551 + 110.378 + 86.121 = $415.5 Mil.
Gross Profit was 72.045 + 87.339 + 78.753 + 51.202 = $289.3 Mil.
Total Current Assets was $1,086.3 Mil.
Total Assets was $1,448.7 Mil.
Property, Plant and Equipment(Net PPE) was $11.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $46.8 Mil.
Selling, General & Admin. Expense(SGA) was $38.5 Mil.
Total Current Liabilities was $406.6 Mil.
Long-Term Debt was $256.6 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)
=(146.883 / 504.084) / (116.079 / 415.458)
=0.29138596 / 0.27940008
=1.0429

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)
=(289.339 / 415.458) / (393.282 / 504.084)
=0.69643382 / 0.7801914
=0.8926

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 - (974.738 + 11.282) / 1442.85) / (1 - (1086.28 + 11.072) / 1448.692)
=0.31661642 / 0.24252222
=1.3055

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
=504.084 / 415.458
=1.2133

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))
=(46.838 / (46.838 + 11.072)) / (51.629 / (51.629 + 11.282))
=0.80880677 / 0.82066729
=0.9855

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)
=(41.58 / 504.084) / (38.467 / 415.458)
=0.08248625 / 0.09258938
=0.8909

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)
=((268.847 + 238.243) / 1442.85) / ((256.56 + 406.582) / 1448.692)
=0.35145025 / 0.45775223
=0.7678

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
=(205.569 - -1.614 - 284.273) / 1442.85
=-0.0534

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.

InterDigital Inc has a M-score of -2.34 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.

InterDigital Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 2.29172.03610.26554.82580.11911.09172.75311.11370.43580.9814
GMI 1.11891.25620.95850.91490.95371.1160.94161.44460.82630.9326
AQI 0.43921.56481.36470.60161.32350.78251.00510.99651.48820.9303
SGI 2.94540.48750.97541.30171.32660.76482.19750.49071.2781.0616
DEPI 1.10740.98950.81520.84230.94670.97010.97170.99041.00880.967
SGAI 0.11282.38431.14360.53260.8611.45470.53981.70750.94390.9926
LVGI 1.24771.37461.05610.88650.73161.79490.96320.85241.17281.2664
TATA -0.1588-0.2481-0.1469-0.25670.01960.13440.0894-0.1419-0.11480.0039
M-score -0.38-3.14-3.800.00-2.70-2.340.68-3.33-3.23-2.58

InterDigital Inc Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 7.87151.45390.43581.07040.36960.89410.98141.18680.94981.0429
GMI 1.09660.81630.82630.8121.05560.98410.93260.97680.92990.8926
AQI 0.99111.18371.48820.95551.09090.9590.93031.60811.47021.3055
SGI 0.72591.36941.2781.39460.84920.96761.06160.93691.00891.2133
DEPI 1.01830.95671.00880.98540.98351.00310.9671.01430.990.9855
SGAI 1.4450.7720.94390.87991.26571.12190.99261.15691.0970.8909
LVGI 1.00341.1321.17281.48841.38461.3711.26640.77980.97150.7678
TATA 0.0747-0.0515-0.1148-0.0759-0.09670.01750.0091-0.0017-0.1143-0.0534
M-score 3.92-2.01-3.23-2.68-3.75-2.69-2.55-2.09-2.91-2.34
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