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Meredith Corp (NYSE:MDP)
Beneish M-Score
-2.49 (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.

Meredith Corp has a M-score of -2.49 suggests that the company is not a manipulator.

MDP' s 10-Year Beneish M-Score Range
Min: -3.45   Max: -2.14
Current: -2.49

-3.45
-2.14

During the past 13 years, the highest Beneish M-Score of Meredith Corp was -2.14. The lowest was -3.45. And the median was -2.58.


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 Meredith Corp 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 * 1.0179+0.528 * 0.9834+0.404 * 1.0407+0.892 * 1.0854+0.115 * 0.8597
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9776+4.679 * -0.0195-0.327 * 1.0178
=-2.49

* 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 $285 Mil.
Revenue was 425.908 + 398.179 + 398.905 + 371.184 = $1,594 Mil.
Gross Profit was 263.585 + 243.731 + 258.622 + 229.297 = $995 Mil.
Total Current Assets was $483 Mil.
Total Assets was $2,843 Mil.
Property, Plant and Equipment(Net PPE) was $214 Mil.
Depreciation, Depletion and Amortization(DDA) was $73 Mil.
Selling, General & Admin. Expense(SGA) was $695 Mil.
Total Current Liabilities was $531 Mil.
Long-Term Debt was $733 Mil.
Net Income was 42.579 + 25.256 + 39.591 + 29.365 = $137 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 69.052 + 48.926 + 63.223 + 11.146 = $192 Mil.
Accounts Receivable was $258 Mil.
Revenue was 390.794 + 367.414 + 354.048 + 356.452 = $1,469 Mil.
Gross Profit was 241.529 + 222.648 + 221.832 + 215.675 = $902 Mil.
Total Current Assets was $493 Mil.
Total Assets was $2,544 Mil.
Property, Plant and Equipment(Net PPE) was $205 Mil.
Depreciation, Depletion and Amortization(DDA) was $58 Mil.
Selling, General & Admin. Expense(SGA) was $655 Mil.
Total Current Liabilities was $483 Mil.
Long-Term Debt was $628 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)
=(284.646 / 1594.176) / (257.644 / 1468.708)
=0.17855369 / 0.17542221
=1.0179

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)
=(243.731 / 1468.708) / (263.585 / 1594.176)
=0.61393007 / 0.62429431
=0.9834

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 - (482.531 + 213.736) / 2843.282) / (1 - (493.122 + 204.938) / 2543.8)
=0.75511856 / 0.72558377
=1.0407

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
=1594.176 / 1468.708
=1.0854

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))
=(57.511 / (57.511 + 204.938)) / (73.122 / (73.122 + 213.736))
=0.2191321 / 0.25490661
=0.8597

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)
=(695.319 / 1594.176) / (655.241 / 1468.708)
=0.436162 / 0.44613429
=0.9776

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)
=((732.5 + 531.001) / 2843.282) / ((627.5 + 483.103) / 2543.8)
=0.44438118 / 0.43659211
=1.0178

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
=(136.791 - 0 - 192.347) / 2843.282
=-0.0195

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.

Meredith Corp has a M-score of -2.49 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.

Meredith Corp Annual Data

Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13Jun14Jun15
DSRI 1.05631.07950.89910.91781.18020.9411.03241.00851.11111.0179
GMI 0.98280.98231.04261.04630.92360.96931.00350.97351.00770.9834
AQI 1.040.98811.03280.96370.98431.03781.04170.9961.00441.0407
SGI 1.28271.03490.96070.90750.9851.00920.9831.06880.99821.0854
DEPI 0.92491.04380.95621.05491.03171.08721.03890.98411.04020.8597
SGAI 1.07311.00550.99531.04631.06850.97721.04791.02171.00350.9776
LVGI 1.26830.85981.00431.05460.91220.81961.15040.9411.23481.0178
TATA -0.0098-0.0108-0.0589-0.1725-0.0508-0.0509-0.0385-0.0306-0.0254-0.0195
M-score -2.32-2.39-2.85-3.45-2.59-2.69-2.68-2.56-2.57-2.49

Meredith Corp Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 0.95691.00851.01271.04741.05891.11111.10491.16551.05151.0179
GMI 0.97760.97350.98040.98880.99781.00771.00350.99320.98690.9834
AQI 0.99170.9961.00561.00341.0291.00441.01641.02421.03121.0407
SGI 1.08021.06881.05041.02251.00410.99821.00671.04171.06431.0854
DEPI 0.92520.96940.98860.99541.03611.04020.98681.01190.9090.8597
SGAI 1.02271.02171.02431.01441.02321.00350.99190.9830.97930.9776
LVGI 0.91630.9410.92880.94151.1111.23481.23841.33841.13741.0178
TATA -0.0338-0.0306-0.0231-0.0241-0.0262-0.0254-0.0302-0.0228-0.0266-0.0195
M-score -2.61-2.56-2.52-2.52-2.57-2.57-2.59-2.50-2.55-2.49
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