Switch to:
Nabors Industries Ltd (NYSE:NBR)
Beneish M-Score
-3.34 (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.

Nabors Industries Ltd has a M-score of -3.34 suggests that the company is not a manipulator.

NBR' s Beneish M-Score Range Over the Past 10 Years
Min: -3.82   Max: -1.25
Current: -3.34

-3.82
-1.25

During the past 13 years, the highest Beneish M-Score of Nabors Industries Ltd was -1.25. The lowest was -3.82. And the median was -2.54.


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 Nabors Industries Ltd 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 * 0.7285+0.528 * 0.9563+0.404 * 1.4469+0.892 * 0.7364+0.115 * 0.8819
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0972+4.679 * -0.1025-0.327 * 1.0729
=-3.34

* 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 $871 Mil.
Revenue was 812.431 + 863.37 + 1422.178 + 1785.003 = $4,883 Mil.
Gross Profit was 294.257 + 374.848 + 502.568 + 590.159 = $1,762 Mil.
Total Current Assets was $1,719 Mil.
Total Assets was $9,929 Mil.
Property, Plant and Equipment(Net PPE) was $7,288 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,037 Mil.
Selling, General & Admin. Expense(SGA) was $438 Mil.
Total Current Liabilities was $1,050 Mil.
Long-Term Debt was $3,738 Mil.
Net Income was -295.834 + -36.821 + 123.634 + -891.07 = $-1,100 Mil.
Non Operating Income was -259.731 + -1.338 + 55.842 + -1020.029 = $-1,225 Mil.
Cash Flow from Operations was 87.607 + 210.234 + 307.17 + 537.567 = $1,143 Mil.
Accounts Receivable was $1,624 Mil.
Revenue was 1813.1 + 1623.471 + 1588.153 + 1606.496 = $6,631 Mil.
Gross Profit was 631.114 + 556.976 + 526.414 + 573.655 = $2,288 Mil.
Total Current Assets was $2,792 Mil.
Total Assets was $12,619 Mil.
Property, Plant and Equipment(Net PPE) was $9,017 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,112 Mil.
Selling, General & Admin. Expense(SGA) was $542 Mil.
Total Current Liabilities was $1,416 Mil.
Long-Term Debt was $4,255 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)
=(871.385 / 4882.982) / (1624.441 / 6631.22)
=0.17845345 / 0.24496865
=0.7285

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)
=(374.848 / 6631.22) / (294.257 / 4882.982)
=0.34505853 / 0.36081067
=0.9563

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 - (1719.075 + 7287.531) / 9929.181) / (1 - (2792.471 + 9016.508) / 12619.34)
=0.09291552 / 0.0642158
=1.4469

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
=4882.982 / 6631.22
=0.7364

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))
=(1112.46 / (1112.46 + 9016.508)) / (1036.663 / (1036.663 + 7287.531))
=0.10982955 / 0.12453614
=0.8819

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)
=(438.042 / 4882.982) / (542.17 / 6631.22)
=0.08970789 / 0.08176022
=1.0972

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)
=((3737.773 + 1049.551) / 9929.181) / ((4255.136 + 1415.581) / 12619.34)
=0.48214692 / 0.44936716
=1.0729

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
=(-1100.091 - -1225.256 - 1142.578) / 9929.181
=-0.1025

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.

Nabors Industries Ltd has a M-score of -3.34 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.

Nabors Industries Ltd Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.06910.97420.91551.04050.9311.31250.96060.81331.0720.9949
GMI 0.81630.91271.08991.0650.94681.02771.10481.13130.93741.0719
AQI 1.0391.33670.89150.80980.79681.35460.8840.69311.03710.6826
SGI 1.42381.38571.02291.07350.671.17491.46991.07830.94431.0898
DEPI 1.04461.20320.94130.9550.98250.88650.91050.93310.95510.9642
SGAI 0.88841.21661.02371.02481.33140.67340.98390.99941.05380.9602
LVGI 0.87951.47550.89410.94630.95041.04841.06320.91420.98491.1611
TATA -0.0532-0.0483-0.0424-0.0938-0.1599-0.0776-0.0782-0.1105-0.0784-0.1192
M-score -2.30-2.47-2.71-2.85-3.74-2.21-2.48-3.13-2.86-3.10

Nabors Industries Ltd Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 0.89950.97221.08571.05611.0751.1250.99490.62530.67890.7285
GMI 0.99480.92850.93510.99051.01771.06261.07191.01660.97970.9563
AQI 0.86510.92341.03711.00790.98131.00220.68261.57091.70521.4469
SGI 0.92850.91640.93230.961.00381.05981.08981.06830.92390.7364
DEPI 0.88960.88620.95510.98511.02521.0680.96420.83790.87530.8819
SGAI 1.07961.06511.06311.04991.01330.98480.96020.96061.00921.0972
LVGI 0.93430.94040.98490.95340.9911.06231.16111.13161.10141.0729
TATA -0.1148-0.105-0.0784-0.1088-0.0937-0.1022-0.1192-0.119-0.1129-0.1025
M-score -3.24-3.14-2.86-2.97-2.84-2.77-3.10-3.14-3.15-3.34
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)

GuruFocus Premium Plus Membership

FEEDBACK