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Jakks Pacific Inc (NAS:JAKK)
Beneish M-Score
-2.12 (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.

Jakks Pacific Inc has a M-score of -2.12 signals that the company is a manipulator.

JAKK' s 10-Year Beneish M-Score Range
Min: -7.03   Max: 0.02
Current: -2.12

-7.03
0.02

During the past 13 years, the highest Beneish M-Score of Jakks Pacific Inc was 0.02. The lowest was -7.03. And the median was -2.52.


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 Jakks Pacific 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 * 0.8273+0.528 * 0.9958+0.404 * 0.9467+0.892 * 1.2951+0.115 * 1.2071
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8444+4.679 * 0.0435-0.327 * 0.9186
=-2.12

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $117.1 Mil.
Revenue was 131.106 + 114.201 + 254.016 + 349.362 = $848.7 Mil.
Gross Profit was 39.287 + 35.378 + 79.697 + 94.737 = $249.1 Mil.
Total Current Assets was $383.0 Mil.
Total Assets was $510.7 Mil.
Property, Plant and Equipment(Net PPE) was $19.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $21.2 Mil.
Selling, General & Admin. Expense(SGA) was $205.2 Mil.
Total Current Liabilities was $150.9 Mil.
Long-Term Debt was $215.0 Mil.
Net Income was -5.68 + -7.581 + 2.798 + 44.069 = $33.6 Mil.
Non Operating Income was 1.684 + 0 + 0 + 5.932 = $7.6 Mil.
Cash Flow from Operations was 11.462 + 38.788 + 26.094 + -72.548 = $3.8 Mil.
Accounts Receivable was $109.3 Mil.
Revenue was 124.172 + 82.51 + 137.73 + 310.894 = $655.3 Mil.
Gross Profit was 37.818 + 23.555 + 38.767 + 91.395 = $191.5 Mil.
Total Current Assets was $400.1 Mil.
Total Assets was $534.1 Mil.
Property, Plant and Equipment(Net PPE) was $14.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $24.5 Mil.
Selling, General & Admin. Expense(SGA) was $187.7 Mil.
Total Current Liabilities was $201.6 Mil.
Long-Term Debt was $215.0 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)
=(117.148 / 848.685) / (109.342 / 655.306)
=0.13803472 / 0.1668564
=0.8273

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)
=(35.378 / 655.306) / (39.287 / 848.685)
=0.2922833 / 0.29351173
=0.9958

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 - (382.963 + 19.315) / 510.705) / (1 - (400.06 + 14.277) / 534.115)
=0.21230848 / 0.22425508
=0.9467

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
=848.685 / 655.306
=1.2951

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))
=(24.513 / (24.513 + 14.277)) / (21.222 / (21.222 + 19.315))
=0.63194122 / 0.52352172
=1.2071

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)
=(205.236 / 848.685) / (187.677 / 655.306)
=0.24182824 / 0.28639597
=0.8444

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)
=((215 + 150.94) / 510.705) / ((215 + 201.613) / 534.115)
=0.7165389 / 0.78000618
=0.9186

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
=(33.606 - 7.616 - 3.796) / 510.705
=0.0435

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.

Jakks Pacific Inc has a M-score of -2.12 signals that the company is likely to 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.

Jakks Pacific Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.74021.51771.01740.80260.98961.01380.9331.03431.01121.8102
GMI 0.97621.04671.021.0621.40820.77031.14520.96421.20610.8455
AQI 0.9321.11830.94411.15290.32370.99711.00251.45151.0930.7686
SGI 1.1521.1571.11981.0540.88960.92980.9070.98380.94931.2799
DEPI 1.2050.90521.09581.12810.78171.00091.02061.01130.88341.0386
SGAI 0.90050.97920.95551.05671.05760.92261.0911.11380.99930.7976
LVGI 0.85081.0380.89330.90121.55650.88421.03271.62131.11651.1433
TATA -0.0207-0.0052-0.0202-0.0018-0.7383-0.0416-0.0679-0.2381-0.07620.1679
M-score -2.63-1.84-2.41-2.49-6.32-2.80-2.89-3.63-2.78-0.88

Jakks Pacific Inc Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.1250.85461.14031.01121.05961.11161.06911.81021.20840.8273
GMI 0.96681.16391.17431.20611.20370.82840.83680.84550.83170.9958
AQI 1.49261.83320.88531.0931.07080.74550.79640.76860.82130.9467
SGI 0.98910.91340.93230.94930.94931.03641.10351.27991.32071.2951
DEPI 0.96990.93091.03370.88340.88060.96730.89531.03861.1041.2071
SGAI 1.10761.17591.09010.99930.93680.84170.81620.79760.81260.8444
LVGI 1.72661.60341.28321.11651.11331.26911.15241.14331.09180.9186
TATA -0.2656-0.3933-0.1946-0.0763-0.04540.00940.04310.16790.11390.0435
M-score -3.70-4.34-3.38-2.78-2.59-2.56-2.32-0.88-1.62-2.12
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