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Jakks Pacific Inc (NAS:JAKK)
Beneish M-Score
-2.54 (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 -2.54 suggests that the company is not a manipulator.

JAKK' s Beneish M-Score Range Over the Past 10 Years
Min: -7.03   Max: 0.02
Current: -2.54

-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 -2.48.


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 * 0.7982+0.528 * 0.9081+0.404 * 0.9674+0.892 * 1.2055+0.115 * 1.3388
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9501+4.679 * -0.0128-0.327 * 0.9434
=-2.54

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $292.9 Mil.
Revenue was 337.027 + 131.106 + 114.201 + 254.016 = $836.4 Mil.
Gross Profit was 104.329 + 39.287 + 35.378 + 79.697 = $258.7 Mil.
Total Current Assets was $513.5 Mil.
Total Assets was $639.6 Mil.
Property, Plant and Equipment(Net PPE) was $18.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $20.0 Mil.
Selling, General & Admin. Expense(SGA) was $214.0 Mil.
Total Current Liabilities was $241.9 Mil.
Long-Term Debt was $215.0 Mil.
Net Income was 45.845 + -5.68 + -7.581 + 2.798 = $35.4 Mil.
Non Operating Income was 5.702 + 1.684 + 0 + 0 = $7.4 Mil.
Cash Flow from Operations was -40.143 + 11.462 + 38.788 + 26.094 = $36.2 Mil.
Accounts Receivable was $304.3 Mil.
Revenue was 349.362 + 124.172 + 82.51 + 137.73 = $693.8 Mil.
Gross Profit was 94.737 + 37.818 + 23.555 + 38.767 = $194.9 Mil.
Total Current Assets was $539.6 Mil.
Total Assets was $665.8 Mil.
Property, Plant and Equipment(Net PPE) was $10.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $23.8 Mil.
Selling, General & Admin. Expense(SGA) was $186.9 Mil.
Total Current Liabilities was $289.2 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)
=(292.861 / 836.35) / (304.338 / 693.774)
=0.3501656 / 0.43867023
=0.7982

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)
=(39.287 / 693.774) / (104.329 / 836.35)
=0.28089407 / 0.3093095
=0.9081

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 - (513.525 + 18.604) / 639.557) / (1 - (539.603 + 10.552) / 665.756)
=0.16797252 / 0.17363869
=0.9674

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
=836.35 / 693.774
=1.2055

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))
=(23.831 / (23.831 + 10.552)) / (19.969 / (19.969 + 18.604))
=0.69310415 / 0.51769372
=1.3388

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)
=(214.012 / 836.35) / (186.86 / 693.774)
=0.25588809 / 0.26933843
=0.9501

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 + 241.947) / 639.557) / ((215 + 289.202) / 665.756)
=0.71447424 / 0.75733752
=0.9434

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
=(35.382 - 7.386 - 36.201) / 639.557
=-0.0128

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 -2.54 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.

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 -0.0207-0.0052-0.0202-0.0018-0.7383-0.0416-0.0679-0.2381-0.07630.1679
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

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 0.85461.14031.01121.05961.11161.06911.81021.20840.82730.7982
GMI 1.16391.17431.20611.20370.82840.83680.84550.83170.99580.9081
AQI 1.83320.88531.0931.07080.74550.79640.76860.82130.94670.9674
SGI 0.91340.93230.94930.94931.03641.10351.27991.32071.29511.2055
DEPI 0.93091.03370.88340.88060.96730.89531.03861.1041.20711.3388
SGAI 1.17591.09010.99930.93680.84170.81620.79760.81260.84440.9501
LVGI 1.60341.28321.11651.11331.26911.15241.14331.09180.91860.9434
TATA -0.3933-0.1946-0.0763-0.04540.00940.04310.16790.11390.0435-0.0128
M-score -4.34-3.38-2.78-2.59-2.56-2.32-0.88-1.62-2.12-2.54
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