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NII Holdings Inc (NAS:NIHD)
Beneish M-Score
-3.13 (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.

NII Holdings Inc has a M-score of -3.13 suggests that the company is not a manipulator.

NIHD' s Beneish M-Score Range Over the Past 10 Years
Min: -4.7   Max: 1.48
Current: -3.13

-4.7
1.48

During the past 13 years, the highest Beneish M-Score of NII Holdings Inc was 1.48. The lowest was -4.70. 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 NII Holdings 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 * 0.3154+0.528 * 1.1057+0.404 * 2.2405+0.892 * 1.2136+0.115 * 0.2781
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9365+4.679 * -0.1599-0.327 * 0.8327
=-3.13

* 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 $179 Mil.
Revenue was 284.652 + 420.765 + 763.869 + 2271.771 = $3,741 Mil.
Gross Profit was 144.166 + 190.76 + 312.206 + 833.691 = $1,481 Mil.
Total Current Assets was $818 Mil.
Total Assets was $2,843 Mil.
Property, Plant and Equipment(Net PPE) was $564 Mil.
Depreciation, Depletion and Amortization(DDA) was $573 Mil.
Selling, General & Admin. Expense(SGA) was $1,700 Mil.
Total Current Liabilities was $897 Mil.
Long-Term Debt was $88 Mil.
Net Income was -189.421 + 2050.033 + -309.517 + -514.861 = $1,036 Mil.
Non Operating Income was -103.546 + 1975.967 + -97.182 + -132.339 = $1,643 Mil.
Cash Flow from Operations was -64.891 + -83.902 + -170.855 + 167.457 = $-152 Mil.
Accounts Receivable was $468 Mil.
Revenue was 476.264 + 586.914 + 955.781 + 1063.768 = $3,083 Mil.
Gross Profit was 216.646 + 239.612 + 374.848 + 518.099 = $1,349 Mil.
Total Current Assets was $2,011 Mil.
Total Assets was $6,246 Mil.
Property, Plant and Equipment(Net PPE) was $2,801 Mil.
Depreciation, Depletion and Amortization(DDA) was $457 Mil.
Selling, General & Admin. Expense(SGA) was $1,496 Mil.
Total Current Liabilities was $2,277 Mil.
Long-Term Debt was $319 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)
=(179.316 / 3741.057) / (468.465 / 3082.727)
=0.04793191 / 0.15196448
=0.3154

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)
=(190.76 / 3082.727) / (144.166 / 3741.057)
=0.43766607 / 0.39583011
=1.1057

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 - (817.697 + 563.595) / 2842.79) / (1 - (2011.263 + 2801.283) / 6245.67)
=0.51410692 / 0.22945881
=2.2405

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
=3741.057 / 3082.727
=1.2136

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))
=(456.841 / (456.841 + 2801.283)) / (573.273 / (573.273 + 563.595))
=0.14021596 / 0.50425643
=0.2781

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)
=(1699.877 / 3741.057) / (1495.704 / 3082.727)
=0.45438415 / 0.4851886
=0.9365

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)
=((87.51 + 896.532) / 2842.79) / ((318.948 + 2277.383) / 6245.67)
=0.3461536 / 0.41570096
=0.8327

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
=(1036.234 - 1642.9 - -152.191) / 2842.79
=-0.1599

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.

NII Holdings Inc has a M-score of -3.13 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.

NII Holdings Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.99791.00441.05650.8011.31071.00770.90610.92130.92430.9957
GMI 0.98040.971.00171.00751.04230.96050.99151.04451.12511.3553
AQI 0.74381.3731.03530.9060.83920.97241.25661.25260.71881.2876
SGI 1.3641.35831.39011.29521.02941.27451.20240.85270.82040.7829
DEPI 1.29720.97980.8830.80151.19170.94010.99661.01660.90370.7937
SGAI 1.02081.05370.99371.00330.99821.05861.00361.08491.09191.1176
LVGI 0.96060.82661.05051.03011.07650.92351.1661.0921.29990.4894
TATA -0.0486-0.0567-0.0538-0.0599-0.0791-0.0712-0.0695-0.1123-0.1522-0.2063
M-score -2.46-2.24-2.35-2.75-2.58-2.59-2.67-3.13-3.59-3.22

NII Holdings Inc Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 0.96520.89560.9330.72261.09621.2830.86120.73640.44450.3154
GMI 1.07011.10811.14141.20691.22681.20991.30931.20581.14121.1057
AQI 0.96751.02430.71880.93571.03091.02731.28761.11632.19372.2405
SGI 0.84110.83610.81270.78930.68630.60950.90530.93911.06521.2136
DEPI 0.84060.78880.90370.89271.23221.25950.79370.68860.3060.2781
SGAI 1.11291.14111.11111.14021.16661.19651.07121.01150.97630.9365
LVGI 1.21921.25711.29991.30861.31210.51040.48940.53050.35890.8327
TATA -0.1437-0.1499-0.1507-0.1361-0.1402-0.185-0.203-0.2561-0.2231-0.1599
M-score -3.41-3.49-3.58-3.61-3.30-3.16-3.23-3.70-3.29-3.13
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