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Noble Corporation PLC (NYSE:NE)
Beneish M-Score
-2.62 (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.

Noble Corporation PLC has a M-score of -2.62 suggests that the company is not a manipulator.

NE' s 10-Year Beneish M-Score Range
Min: -3.59   Max: -1.13
Current: -2.62

-3.59
-1.13

During the past 13 years, the highest Beneish M-Score of Noble Corporation PLC was -1.13. The lowest was -3.59. And the median was -2.63.


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 Noble Corporation PLC 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 * 1.0659+0.528 * 0.9313+0.404 * 0.8761+0.892 * 1.1938+0.115 * 0.9661
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9885+4.679 * -0.0567-0.327 * 1.0733
=-2.62

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $1,089 Mil.
Revenue was 1167.049 + 1078.881 + 1017.385 + 970.975 = $4,234 Mil.
Gross Profit was 586.098 + 558.807 + 493.299 + 459.717 = $2,098 Mil.
Total Current Assets was $1,391 Mil.
Total Assets was $16,218 Mil.
Property, Plant and Equipment(Net PPE) was $14,558 Mil.
Depreciation, Depletion and Amortization(DDA) was $879 Mil.
Selling, General & Admin. Expense(SGA) was $118 Mil.
Total Current Liabilities was $1,052 Mil.
Long-Term Debt was $5,556 Mil.
Net Income was 174.06 + 281.957 + 176.62 + 150.06 = $783 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 540.663 + 515.589 + 443.513 + 202.552 = $1,702 Mil.
Accounts Receivable was $856 Mil.
Revenue was 966.367 + 884.032 + 898.923 + 797.69 = $3,547 Mil.
Gross Profit was 459.417 + 400.869 + 438.604 + 337.846 = $1,637 Mil.
Total Current Assets was $1,305 Mil.
Total Assets was $14,608 Mil.
Property, Plant and Equipment(Net PPE) was $13,026 Mil.
Depreciation, Depletion and Amortization(DDA) was $759 Mil.
Selling, General & Admin. Expense(SGA) was $100 Mil.
Total Current Liabilities was $911 Mil.
Long-Term Debt was $4,634 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)
=(1089.338 / 4234.29) / (856.096 / 3547.012)
=0.2572658 / 0.24135695
=1.0659

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)
=(558.807 / 3547.012) / (586.098 / 4234.29)
=0.46144078 / 0.49545992
=0.9313

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 - (1390.935 + 14558.09) / 16217.957) / (1 - (1305.325 + 13025.972) / 14607.774)
=0.01658236 / 0.0189267
=0.8761

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
=4234.29 / 3547.012
=1.1938

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))
=(758.621 / (758.621 + 13025.972)) / (879.422 / (879.422 + 14558.09))
=0.05503398 / 0.05696656
=0.9661

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)
=(117.997 / 4234.29) / (99.99 / 3547.012)
=0.02786701 / 0.02818992
=0.9885

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)
=((5556.251 + 1051.915) / 16217.957) / ((4634.375 + 911.449) / 14607.774)
=0.40745983 / 0.37964881
=1.0733

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
=(782.697 - 0 - 1702.317) / 16217.957
=-0.0567

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.

Noble Corporation PLC has a M-score of -2.62 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.

Noble Corporation PLC Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.27221.23510.92710.98890.87730.9310.77611.78050.98221.0659
GMI 1.08910.80660.78120.92950.92850.96561.26031.21910.98020.9313
AQI 0.94564.51440.1811.08940.82511.07710.91780.74090.83690.8761
SGI 1.07991.29631.51961.42621.15061.05640.7710.96031.31571.1938
DEPI 0.9180.94941.21081.07010.96911.02471.13710.990.93580.9661
SGAI 1.17220.92160.7561.30060.75071.02481.48661.03430.83170.9885
LVGI 0.88021.47310.75810.89020.93310.70142.15151.19571.04581.0733
TATA -0.059-0.0628-0.0605-0.038-0.046-0.0546-0.0769-0.0274-0.0588-0.0567
M-score -2.41-1.12-2.67-2.30-2.72-2.64-3.59-1.99-2.56-2.62

Noble Corporation PLC Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.6211.78051.63371.03581.07360.98220.94251.03060.91621.0659
GMI 1.3631.21911.07850.93980.97620.98020.9510.98690.93880.9313
AQI 1.32690.74091.2960.72480.5820.83690.46820.77340.75380.8761
SGI 0.83410.96031.14511.29321.28711.31571.27641.2051.21071.1938
DEPI 0.91960.991.00351.00410.99890.93580.92690.94080.93390.9661
SGAI 1.23861.03430.84570.79860.77910.83170.88390.91160.97480.9885
LVGI 1.1631.19571.16611.12181.10041.04581.02991.09961.05531.0733
TATA -0.0355-0.0273-0.0228-0.0357-0.0478-0.0588-0.0626-0.0597-0.0557-0.0567
M-score -2.00-1.99-1.74-2.50-2.56-2.56-2.82-2.67-2.78-2.62
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