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Meredith Corp (NYSE:MDP)
Beneish M-Score
-2.55 (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 -2.55 suggests that the company is not a manipulator.

MDP' s Beneish M-Score Range Over the Past 10 Years
Min: -3.45   Max: -2.14
Current: -2.55

-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 -2.59.


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 * 0.9924+0.528 * 1.007+0.404 * 0.9979+0.892 * 1.0518+0.115 * 0.8692
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0009+4.679 * -0.0268-0.327 * 0.9
=-2.55

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $281 Mil.
Revenue was 422.771 + 406.413 + 384.666 + 425.908 = $1,640 Mil.
Gross Profit was 266.032 + 255.348 + 231.488 + 263.585 = $1,016 Mil.
Total Current Assets was $489 Mil.
Total Assets was $2,824 Mil.
Property, Plant and Equipment(Net PPE) was $195 Mil.
Depreciation, Depletion and Amortization(DDA) was $78 Mil.
Selling, General & Admin. Expense(SGA) was $725 Mil.
Total Current Liabilities was $510 Mil.
Long-Term Debt was $631 Mil.
Net Income was 80.904 + 32.519 + 11.029 + 42.579 = $167 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 125.918 + 44.873 + 2.829 + 69.052 = $243 Mil.
Accounts Receivable was $270 Mil.
Revenue was 398.179 + 398.905 + 371.184 + 390.794 = $1,559 Mil.
Gross Profit was 243.731 + 258.622 + 229.297 + 241.529 = $973 Mil.
Total Current Assets was $470 Mil.
Total Assets was $2,829 Mil.
Property, Plant and Equipment(Net PPE) was $210 Mil.
Depreciation, Depletion and Amortization(DDA) was $69 Mil.
Selling, General & Admin. Expense(SGA) was $689 Mil.
Total Current Liabilities was $507 Mil.
Long-Term Debt was $763 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)
=(281.317 / 1639.758) / (269.527 / 1559.062)
=0.17156007 / 0.17287767
=0.9924

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)
=(255.348 / 1559.062) / (266.032 / 1639.758)
=0.62420802 / 0.61987988
=1.007

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 - (488.598 + 195.313) / 2823.898) / (1 - (470.327 + 210.266) / 2828.723)
=0.75781314 / 0.75939921
=0.9979

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
=1639.758 / 1559.062
=1.0518

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))
=(69.001 / (69.001 + 210.266)) / (77.573 / (77.573 + 195.313))
=0.24707896 / 0.28426889
=0.8692

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)
=(724.866 / 1639.758) / (688.585 / 1559.062)
=0.44205669 / 0.44166621
=1.0009

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)
=((631.25 + 509.619) / 2823.898) / ((763.125 + 506.703) / 2828.723)
=0.40400503 / 0.44890504
=0.9

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
=(167.031 - 0 - 242.672) / 2823.898
=-0.0268

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 -2.55 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 1.03581.10450.87980.93791.18020.9411.03241.00851.11111.0179
GMI 0.9830.98311.04321.04580.92360.96931.00350.97351.00770.9834
AQI 1.040.98811.03280.96370.98431.03781.04170.9961.00441.0407
SGI 1.30811.01150.98180.8880.9851.00920.9831.06880.99821.0854
DEPI 0.92491.04380.95621.05491.03171.08721.03890.98411.04020.8597
SGAI 1.08460.99241.00191.03941.06850.97721.04791.02171.00350.9776
LVGI 1.26830.85981.00431.05460.92410.80911.15040.9411.23481.0178
TATA -0.0241-0.0231-0.0589-0.1725-0.0508-0.0509-0.0385-0.0306-0.0254-0.0195
M-score -2.39-2.44-2.85-3.45-2.60-2.69-2.68-2.56-2.57-2.49

Meredith Corp Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.04741.05891.11111.10491.16551.05151.01790.97370.96240.9924
GMI 0.98880.99781.00771.00350.99320.98690.98340.99451.01211.007
AQI 1.00341.0291.00441.01641.02421.03121.04071.01861.01130.9979
SGI 1.02251.00410.99821.00671.04171.06431.08541.08371.05681.0518
DEPI 0.99541.03611.04020.98681.01190.9090.85970.86370.82110.8692
SGAI 1.01441.02321.00350.99190.9830.97930.97761.00861.01471.0009
LVGI 0.94151.1111.23481.23841.33841.13741.01781.04040.94280.9
TATA -0.0241-0.0262-0.0254-0.0302-0.0228-0.0266-0.0195-0.0228-0.0189-0.0268
M-score -2.52-2.57-2.57-2.59-2.50-2.55-2.49-2.56-2.55-2.55
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