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Nasdaq Inc (NAS:NDAQ)
Beneish M-Score
-2.84 (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.

Nasdaq Inc has a M-score of -2.84 suggests that the company is not a manipulator.

NDAQ' s Beneish M-Score Range Over the Past 10 Years
Min: -9.15   Max: -0.66
Current: -2.84

-9.15
-0.66

During the past 13 years, the highest Beneish M-Score of Nasdaq Inc was -0.66. The lowest was -9.15. 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 Nasdaq 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 * 0.7457+0.528 * 1.0061+0.404 * 1.0123+0.892 * 1.0076+0.115 * 1.0558
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0036+4.679 * -0.0301-0.327 * 1.0254
=-2.84

* 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 $278 Mil.
Revenue was 871 + 807 + 858 + 920 = $3,456 Mil.
Gross Profit was 529 + 518 + 507 + 518 = $2,072 Mil.
Total Current Assets was $3,160 Mil.
Total Assets was $11,770 Mil.
Property, Plant and Equipment(Net PPE) was $305 Mil.
Depreciation, Depletion and Amortization(DDA) was $135 Mil.
Selling, General & Admin. Expense(SGA) was $1,087 Mil.
Total Current Liabilities was $2,852 Mil.
Long-Term Debt was $2,415 Mil.
Net Income was 138 + 133 + 9 + 86 = $366 Mil.
Non Operating Income was 2 + 1 + 14 + -49 = $-32 Mil.
Cash Flow from Operations was 66 + 175 + 231 + 280 = $752 Mil.
Accounts Receivable was $370 Mil.
Revenue was 818 + 865 + 898 + 849 = $3,430 Mil.
Gross Profit was 497 + 523 + 529 + 520 = $2,069 Mil.
Total Current Assets was $3,557 Mil.
Total Assets was $12,692 Mil.
Property, Plant and Equipment(Net PPE) was $288 Mil.
Depreciation, Depletion and Amortization(DDA) was $138 Mil.
Selling, General & Admin. Expense(SGA) was $1,075 Mil.
Total Current Liabilities was $3,194 Mil.
Long-Term Debt was $2,345 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)
=(278 / 3456) / (370 / 3430)
=0.08043981 / 0.10787172
=0.7457

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)
=(518 / 3430) / (529 / 3456)
=0.603207 / 0.59953704
=1.0061

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 - (3160 + 305) / 11770) / (1 - (3557 + 288) / 12692)
=0.70560748 / 0.69705326
=1.0123

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
=3456 / 3430
=1.0076

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))
=(138 / (138 + 288)) / (135 / (135 + 305))
=0.32394366 / 0.30681818
=1.0558

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)
=(1087 / 3456) / (1075 / 3430)
=0.31452546 / 0.31341108
=1.0036

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)
=((2415 + 2852) / 11770) / ((2345 + 3194) / 12692)
=0.44749363 / 0.43641664
=1.0254

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
=(366 - -32 - 752) / 11770
=-0.0301

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.

Nasdaq Inc has a M-score of -2.84 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.

Nasdaq Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.59630.72780.90690.95011.05830.96151.18861.14670.90810.8355
GMI 1.44171.24390.83340.9390.89660.96880.9140.90910.99930.9616
AQI 0.55551.14881.35331.19720.69331.11721.56670.89390.95511.0019
SGI 1.8841.46981.4980.93450.93551.07490.90961.02921.090.9723
DEPI 0.68741.38471.11610.86831.00591.06881.09321.05540.97961.0668
SGAI 0.70350.68931.1021.15911.14081.00331.09021.23090.95310.9862
LVGI 0.71240.33823.25380.76121.45910.89590.54381.36911.0221.0219
TATA -0.0371-0.03970.0128-0.018-0.002-0.0189-0.0205-0.0161-0.01850.0347
M-score -2.07-1.99-2.75-2.59-2.85-2.46-2.16-2.64-2.59-2.51

Nasdaq Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.16751.14641.24460.97680.90420.90810.77090.82110.74570.8362
GMI 0.90710.90940.92010.91490.95490.99931.00861.01451.00610.9607
AQI 0.88620.89390.88370.91150.94960.95510.9540.99391.01231.0019
SGI 0.97441.02951.11.1171.10011.091.02820.99591.00760.9714
DEPI 1.07911.05540.99950.98610.97530.97961.00661.04131.05581.0723
SGAI 1.20281.22941.051.04280.97530.95231.02440.99591.00360.988
LVGI 1.39971.36911.3621.04971.01281.0221.07581.00841.02541.0219
TATA -0.0187-0.0162-0.0144-0.0204-0.0158-0.0186-0.0311-0.0269-0.0301-0.0051
M-score -2.69-2.64-2.45-2.60-2.60-2.59-2.85-2.77-2.84-2.70
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