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Orbit International Corp (NAS:ORBT)
Beneish M-Score
-4.24 (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.

Orbit International Corp has a M-score of -4.24 suggests that the company is not a manipulator.

ORBT' s 10-Year Beneish M-Score Range
Min: -4.68   Max: 2.3
Current: -4.24

-4.68
2.3

During the past 13 years, the highest Beneish M-Score of Orbit International Corp was 2.30. The lowest was -4.68. And the median was -2.46.


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 Orbit International Corp 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 * 1.0204+0.528 * 1.1089+0.404 * 0.4506+0.892 * 0.7872+0.115 * 0.4377
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.2553+4.679 * -0.2847-0.327 * 0.9607
=-4.24

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $3.27 Mil.
Revenue was 5.007 + 5.807 + 6.109 + 6.475 = $23.40 Mil.
Gross Profit was 1.5 + 1.989 + 2.366 + 2.497 = $8.35 Mil.
Total Current Assets was $17.02 Mil.
Total Assets was $18.69 Mil.
Property, Plant and Equipment(Net PPE) was $0.76 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.64 Mil.
Selling, General & Admin. Expense(SGA) was $9.55 Mil.
Total Current Liabilities was $1.95 Mil.
Long-Term Debt was $1.97 Mil.
Net Income was -1.062 + -2.726 + 0.127 + 0.109 = $-3.55 Mil.
Non Operating Income was 0.01 + 0.011 + 0.006 + 0.002 = $0.03 Mil.
Cash Flow from Operations was -0.855 + 1.348 + 1.178 + 0.068 = $1.74 Mil.
Accounts Receivable was $4.07 Mil.
Revenue was 6.447 + 7.903 + 7.864 + 7.509 = $29.72 Mil.
Gross Profit was 2.491 + 3.381 + 3.059 + 2.834 = $11.77 Mil.
Total Current Assets was $20.20 Mil.
Total Assets was $23.94 Mil.
Property, Plant and Equipment(Net PPE) was $1.16 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.29 Mil.
Selling, General & Admin. Expense(SGA) was $9.67 Mil.
Total Current Liabilities was $5.23 Mil.
Long-Term Debt was $0.00 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)
=(3.267 / 23.398) / (4.067 / 29.723)
=0.13962732 / 0.13683006
=1.0204

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)
=(1.989 / 29.723) / (1.5 / 23.398)
=0.39582142 / 0.35695359
=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 - (17.016 + 0.761) / 18.685) / (1 - (20.2 + 1.159) / 23.941)
=0.04859513 / 0.10784846
=0.4506

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
=23.398 / 29.723
=0.7872

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))
=(0.29 / (0.29 + 1.159)) / (0.641 / (0.641 + 0.761))
=0.20013803 / 0.45720399
=0.4377

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)
=(9.552 / 23.398) / (9.666 / 29.723)
=0.40824002 / 0.3252027
=1.2553

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)
=((1.97 + 1.95) / 18.685) / ((0 + 5.228) / 23.941)
=0.20979395 / 0.21837016
=0.9607

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
=(-3.552 - 0.029 - 1.739) / 18.685
=-0.2847

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.

Orbit International Corp has a M-score of -4.24 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.

Orbit International Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.89951.11010.9741.22281.27540.62851.00941.08421.14640.6577
GMI 1.01190.96371.03190.99821.02671.04411.1420.83121.07591.0531
AQI 0.96272.47220.8471.26990.64040.73670.84220.92780.80880.4084
SGI 1.05091.34651.03141.03481.05710.96911.00871.16050.94840.8437
DEPI 1.21050.44870.99011.30810.81431.49811.53271.15511.01270.6449
SGAI 0.94840.98371.00751.01821.1251.01871.12350.73861.15731.0349
LVGI 0.7592.58540.87641.17311.04630.931910.75031.05480.7896
TATA 0.0828-0.0146-0.07560.0166-0.1548-0.1327-0.14180.04710.0386-0.3333
M-score -2.04-2.14-2.84-2.08-3.09-3.48-3.08-2.01-2.29-4.68

Orbit International Corp Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.74390.73060.9671.14641.12821.08571.20640.65771.02040.7376
GMI 0.90240.93640.99261.07591.05481.03471.0061.05311.10891.0987
AQI 0.9230.90240.9280.80880.85271.0270.90420.40840.45060.4015
SGI 1.08431.00940.99120.94840.9780.96870.9090.84370.78720.778
DEPI 1.01811.05091.03871.01270.97950.94490.94820.64490.43770.4396
SGAI 0.91151.00340.95831.15730.86860.84310.92761.03491.25531.3038
LVGI 0.76660.86340.99711.05480.8760.77540.72730.78960.96070.961
TATA -0.0606-0.07970.03490.03410.009-0.0398-0.0898-0.3333-0.2847-0.3738
M-score -2.91-3.12-2.38-2.31-2.31-2.49-2.73-4.68-4.24-4.96
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