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Marriott International, Inc. (NAS:MAR)
Beneish M-Score
-2.85 (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.

Marriott International, Inc. has a M-score of -2.85 suggests that the company is not a manipulator.

MAR' s 10-Year Beneish M-Score Range
Min: -3.58   Max: -1.96
Current: -2.85

-3.58
-1.96

During the past 13 years, the highest Beneish M-Score of Marriott International, Inc. was -1.96. The lowest was -3.58. And the median was -2.78.


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 Marriott International, 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 * 0.9718+0.528 * 1.0007+0.404 * 0.9391+0.892 * 1.0821+0.115 * 0.8173
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0402+4.679 * -0.0765-0.327 * 1.0252
=-2.85

* 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 $1,081 Mil.
Revenue was 3219 + 3160 + 3263 + 3142 = $12,784 Mil.
Gross Profit was 438 + 412 + 458 + 406 = $1,714 Mil.
Total Current Assets was $1,903 Mil.
Total Assets was $6,794 Mil.
Property, Plant and Equipment(Net PPE) was $1,543 Mil.
Depreciation, Depletion and Amortization(DDA) was $127 Mil.
Selling, General & Admin. Expense(SGA) was $726 Mil.
Total Current Liabilities was $2,675 Mil.
Long-Term Debt was $3,147 Mil.
Net Income was 151 + 160 + 179 + 136 = $626 Mil.
Non Operating Income was -6 + 1 + 8 + 3 = $6 Mil.
Cash Flow from Operations was 335 + 195 + 492 + 118 = $1,140 Mil.
Accounts Receivable was $1,028 Mil.
Revenue was 3757 + 2729 + 2776 + 2552 = $11,814 Mil.
Gross Profit was 515 + 345 + 403 + 322 = $1,585 Mil.
Total Current Assets was $1,475 Mil.
Total Assets was $6,342 Mil.
Property, Plant and Equipment(Net PPE) was $1,539 Mil.
Depreciation, Depletion and Amortization(DDA) was $102 Mil.
Selling, General & Admin. Expense(SGA) was $645 Mil.
Total Current Liabilities was $2,773 Mil.
Long-Term Debt was $2,528 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)
=(1081 / 12784) / (1028 / 11814)
=0.08455882 / 0.08701541
=0.9718

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)
=(412 / 11814) / (438 / 12784)
=0.13416286 / 0.13407384
=1.0007

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 - (1903 + 1543) / 6794) / (1 - (1475 + 1539) / 6342)
=0.49278775 / 0.5247556
=0.9391

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
=12784 / 11814
=1.0821

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))
=(102 / (102 + 1539)) / (127 / (127 + 1543))
=0.06215722 / 0.0760479
=0.8173

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)
=(726 / 12784) / (645 / 11814)
=0.05678974 / 0.05459624
=1.0402

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)
=((3147 + 2675) / 6794) / ((2528 + 2773) / 6342)
=0.85693259 / 0.8358562
=1.0252

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
=(626 - 6 - 1140) / 6794
=-0.0765

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.

Marriott International, Inc. has a M-score of -2.85 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.

Marriott International, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.97721.13970.98251.00010.7891.10181.04440.88541.22490.9718
GMI 0.93020.82270.88720.97661.19491.1130.89740.970.96941.0007
AQI 0.94690.93951.00070.96161.00761.02981.01941.20990.90730.9391
SGI 1.12041.1021.07781.0830.99150.8471.07181.05350.95921.0821
DEPI 0.92130.46541.05521.02481.10950.97290.99770.95322.02310.8173
SGAI 1.03591.16760.80431.07071.03171.06161.0080.91510.89421.0402
LVGI 0.95261.21421.13021.25380.97640.92121.01421.28051.12941.0252
TATA -0.049-0.0417-0.0515-0.0217-0.0373-0.1486-0.079-0.1474-0.0705-0.0765
M-score -2.68-2.73-2.73-2.63-2.74-3.13-2.80-3.24-2.60-2.85

Marriott International, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.01180.88540.89510.94480.86841.22491.21990.98861.01940.9718
GMI 1.23550.970.97780.95310.63190.96940.96750.9971.19961.0007
AQI 1.01611.20991.09021.09471.10120.90730.94120.96210.92130.9391
SGI 1.07321.05351.02130.9880.95790.95921.02591.08371.13381.0821
DEPI 1.15240.95321.03551.01311.08312.02311.6221.64891.34780.8173
SGAI 1.22840.91510.90460.91690.85210.89420.89310.86790.93161.0402
LVGI 1.1661.28051.29121.30991.20831.12941.12521.08131.04391.0252
TATA -0.107-0.1474-0.1389-0.132-0.0871-0.0705-0.0629-0.0917-0.0522-0.0765
M-score -2.85-3.24-3.26-3.23-3.23-2.60-2.54-2.79-2.48-2.85
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