Switch to:
Meredith Corp (NYSE:MDP)
Beneish M-Score
-2.50 (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 -2.50 suggests that the company is not a manipulator.

MDP' s 10-Year Beneish M-Score Range
Min: -3.45   Max: -2.09
Current: -2.5

-3.45
-2.09

During the past 13 years, the highest Beneish M-Score of Meredith Corp was -2.09. The lowest was -3.45. And the median was -2.59.


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 * 1.1655+0.528 * 0.9932+0.404 * 1.0242+0.892 * 1.0417+0.115 * 1.0119
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.983+4.679 * -0.0228-0.327 * 1.3384
=-2.50

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $290 Mil.
Revenue was 398.905 + 371.184 + 390.794 + 367.414 = $1,528 Mil.
Gross Profit was 258.622 + 229.297 + 241.529 + 222.648 = $952 Mil.
Total Current Assets was $523 Mil.
Total Assets was $2,803 Mil.
Property, Plant and Equipment(Net PPE) was $213 Mil.
Depreciation, Depletion and Amortization(DDA) was $64 Mil.
Selling, General & Admin. Expense(SGA) was $675 Mil.
Total Current Liabilities was $484 Mil.
Long-Term Debt was $796 Mil.
Net Income was 39.591 + 29.365 + 40.445 + 18.486 = $128 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 63.223 + 11.146 + 86.733 + 30.67 = $192 Mil.
Accounts Receivable was $239 Mil.
Revenue was 354.048 + 356.452 + 386.973 + 369.615 = $1,467 Mil.
Gross Profit was 221.832 + 215.675 + 242.248 + 228.01 = $908 Mil.
Total Current Assets was $418 Mil.
Total Assets was $2,140 Mil.
Property, Plant and Equipment(Net PPE) was $181 Mil.
Depreciation, Depletion and Amortization(DDA) was $55 Mil.
Selling, General & Admin. Expense(SGA) was $659 Mil.
Total Current Liabilities was $415 Mil.
Long-Term Debt was $315 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)
=(289.658 / 1528.297) / (238.573 / 1467.088)
=0.18952991 / 0.16261669
=1.1655

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)
=(229.297 / 1467.088) / (258.622 / 1528.297)
=0.61875293 / 0.62297839
=0.9932

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 - (522.677 + 212.529) / 2802.569) / (1 - (417.814 + 180.808) / 2139.547)
=0.73766712 / 0.72021087
=1.0242

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
=1528.297 / 1467.088
=1.0417

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))
=(54.924 / (54.924 + 180.808)) / (63.57 / (63.57 + 212.529))
=0.2329934 / 0.2302435
=1.0119

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)
=(674.956 / 1528.297) / (659.139 / 1467.088)
=0.44163929 / 0.44928389
=0.983

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)
=((796.25 + 484.413) / 2802.569) / ((315 + 415.486) / 2139.547)
=0.45696038 / 0.34142087
=1.3384

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
=(127.887 - 0 - 191.772) / 2802.569
=-0.0228

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 -2.50 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

Jun05Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13Jun14
DSRI 1.02251.05631.07950.89910.91781.18430.93771.03241.00851.1111
GMI 0.99580.98280.98231.04261.04630.9230.96991.00350.97351.0077
AQI 1.02181.040.98811.03280.96370.98431.03781.04170.9961.0169
SGI 1.04791.28271.03490.96070.90750.98161.01280.9831.06880.9982
DEPI 0.99390.92491.04380.95621.05491.03171.08721.03890.98411.0407
SGAI 0.9521.07311.00550.99531.04631.0630.98241.04791.02171.0035
LVGI 0.93071.26830.85981.00431.05460.92410.80911.15040.9411.2348
TATA -0.0153-0.0098-0.0108-0.0589-0.1725-0.0508-0.0509-0.0385-0.0306-0.0254
M-score -2.45-2.32-2.39-2.85-3.45-2.59-2.69-2.68-2.56-2.56

Meredith Corp Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 0.99640.961.00851.01271.04741.05891.11111.10491.16551.0515
GMI 0.98080.9770.97350.98040.98880.99781.00771.00350.99320.9869
AQI 1.02520.99170.9961.00561.00341.0291.01691.01641.02421.0312
SGI 1.06411.07661.06881.05041.02251.00410.99821.00671.04171.0643
DEPI 0.93950.93960.98411.00310.99541.03611.04070.98681.01190.9549
SGAI 1.04961.01881.02171.02431.01441.02321.00350.99190.9830.9793
LVGI 1.11550.91630.9410.92880.94151.1111.23481.23841.33841.1374
TATA -0.0399-0.0338-0.0306-0.0231-0.0241-0.0262-0.0254-0.0302-0.0228-0.0266
M-score -2.67-2.60-2.56-2.52-2.52-2.57-2.56-2.59-2.50-2.54
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK