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Oil-Dri Corp of America (NYSE:ODC)
Beneish M-Score
-2.12 (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.

Oil-Dri Corp of America has a M-score of -2.12 signals that the company is a manipulator.

ODC' s 10-Year Beneish M-Score Range
Min: -3.24   Max: -1.89
Current: -2.12

-3.24
-1.89

During the past 13 years, the highest Beneish M-Score of Oil-Dri Corp of America was -1.89. The lowest was -3.24. And the median was -2.74.


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 Oil-Dri Corp of America 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 * 1.0348+0.528 * 1.1089+0.404 * 1.5567+0.892 * 1.066+0.115 * 1.0019
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9117+4.679 * -0.0136-0.327 * 0.9057
=-2.12

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

This Year (Apr14) TTM:Last Year (Apr13) TTM:
Accounts Receivable was $32.9 Mil.
Revenue was 67.417 + 69.305 + 63.546 + 63.892 = $264.2 Mil.
Gross Profit was 13.884 + 16.893 + 16.5 + 16.108 = $63.4 Mil.
Total Current Assets was $87.8 Mil.
Total Assets was $184.6 Mil.
Property, Plant and Equipment(Net PPE) was $72.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $9.9 Mil.
Selling, General & Admin. Expense(SGA) was $47.9 Mil.
Total Current Liabilities was $29.8 Mil.
Long-Term Debt was $18.9 Mil.
Net Income was 0.722 + 4.281 + 2.887 + 4.737 = $12.6 Mil.
Non Operating Income was 0.247 + 0.175 + -0.035 + -0.054 = $0.3 Mil.
Cash Flow from Operations was 8.31 + 3.052 + -0.652 + 4.092 = $14.8 Mil.
Accounts Receivable was $29.8 Mil.
Revenue was 64.152 + 61.122 + 61.417 + 61.116 = $247.8 Mil.
Gross Profit was 16.891 + 16.269 + 17.231 + 15.543 = $65.9 Mil.
Total Current Assets was $99.4 Mil.
Total Assets was $180.9 Mil.
Property, Plant and Equipment(Net PPE) was $65.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $9.0 Mil.
Selling, General & Admin. Expense(SGA) was $49.3 Mil.
Total Current Liabilities was $30.3 Mil.
Long-Term Debt was $22.4 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)
=(32.854 / 264.16) / (29.784 / 247.807)
=0.12437159 / 0.12019031
=1.0348

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)
=(16.893 / 247.807) / (13.884 / 264.16)
=0.26606997 / 0.23994927
=1.1089

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 - (87.757 + 71.969) / 184.637) / (1 - (99.421 + 65.758) / 180.854)
=0.13491879 / 0.08667212
=1.5567

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
=264.16 / 247.807
=1.066

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))
=(9.027 / (9.027 + 65.758)) / (9.858 / (9.858 + 71.969))
=0.12070602 / 0.12047368
=1.0019

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)
=(47.906 / 264.16) / (49.291 / 247.807)
=0.18135221 / 0.19890883
=0.9117

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)
=((18.9 + 29.794) / 184.637) / ((22.4 + 30.263) / 180.854)
=0.26372829 / 0.29119068
=0.9057

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
=(12.627 - 0.333 - 14.802) / 184.637
=-0.0136

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.

Oil-Dri Corp of America has a M-score of -2.12 signals that the company is likely to 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.

Oil-Dri Corp of America Annual Data

Jul04Jul05Jul06Jul07Jul08Jul09Jul10Jul11Jul12Jul13
DSRI 0.94860.96471.01261.03481.02560.90891.01071.03850.97460.9898
GMI 0.88321.08531.15770.86121.08660.94850.92151.02790.90010.9238
AQI 0.75051.00190.88380.96571.15111.0760.9230.78691.0730.9182
SGI 1.07211.01271.09231.03371.09541.01670.92721.03521.06141.0411
DEPI 1.02181.09741.14481.00170.90061.14331.04950.95250.88071.0544
SGAI 1.03610.91240.89341.1440.86561.02671.120.97121.22670.9657
LVGI 0.94150.88591.20640.91830.90320.81380.98141.17140.97450.9291
TATA -0.0936-0.0549-0.0436-0.0709-0.0192-0.0435-0.112-0.0258-0.1007-0.0498
M-score -3.05-2.65-2.59-2.83-2.31-2.68-3.14-2.66-2.99-2.72

Oil-Dri Corp of America Quarterly Data

Jan12Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14
DSRI 1.03181.09420.97460.95121.02680.93530.98980.97041.11421.0348
GMI 0.98570.93250.90010.86730.870.88530.92380.98291.0291.1089
AQI 0.85560.87221.0731.05731.04791.11240.91821.00371.73561.5567
SGI 1.03861.06091.06141.05421.04451.04431.04111.0421.07171.066
DEPI 0.93870.6380.62410.65250.67611.42041.48781.50741.46251.0019
SGAI 1.0371.08921.22671.1021.17921.11710.96571.02640.90240.9117
LVGI 0.9050.92690.97450.91880.95340.94260.92910.88620.88970.9057
TATA -0.0434-0.0729-0.1219-0.125-0.1108-0.0975-0.0498-0.0307-0.0005-0.0136
M-score -2.67-2.80-3.12-3.14-3.04-2.92-2.67-2.53-1.89-2.12
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