Switch to:
Overstock.com Inc (NAS:OSTK)
Beneish M-Score
-3.08 (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.

Overstock.com Inc has a M-score of -3.08 suggests that the company is not a manipulator.

OSTK' s Beneish M-Score Range Over the Past 10 Years
Min: -6.1   Max: 1.11
Current: -3.08

-6.1
1.11

During the past 13 years, the highest Beneish M-Score of Overstock.com Inc was 1.11. The lowest was -6.10. And the median was -3.03.


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 Overstock.com 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 * 1.1513+0.528 * 1.0322+0.404 * 1.034+0.892 * 1.0584+0.115 * 1.324
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0436+4.679 * -0.1804-0.327 * 1.0366
=-3.08

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $19 Mil.
Revenue was 418.54 + 413.677 + 480.27 + 391.211 = $1,704 Mil.
Gross Profit was 76.322 + 77.307 + 83.109 + 72.451 = $309 Mil.
Total Current Assets was $194 Mil.
Total Assets was $415 Mil.
Property, Plant and Equipment(Net PPE) was $126 Mil.
Depreciation, Depletion and Amortization(DDA) was $28 Mil.
Selling, General & Admin. Expense(SGA) was $220 Mil.
Total Current Liabilities was $203 Mil.
Long-Term Debt was $41 Mil.
Net Income was -0.904 + 13.429 + 0.11 + -2.071 = $11 Mil.
Non Operating Income was 3.992 + 4.156 + 1.102 + 0.764 = $10 Mil.
Cash Flow from Operations was 7.521 + -34.503 + 90.916 + 11.467 = $75 Mil.
Accounts Receivable was $16 Mil.
Revenue was 388.013 + 398.344 + 470.36 + 352.991 = $1,610 Mil.
Gross Profit was 73.657 + 75.437 + 85.38 + 67.058 = $302 Mil.
Total Current Assets was $184 Mil.
Total Assets was $321 Mil.
Property, Plant and Equipment(Net PPE) was $66 Mil.
Depreciation, Depletion and Amortization(DDA) was $21 Mil.
Selling, General & Admin. Expense(SGA) was $199 Mil.
Total Current Liabilities was $182 Mil.
Long-Term Debt was $0 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)
=(19.305 / 1703.698) / (15.843 / 1609.708)
=0.01133123 / 0.00984216
=1.1513

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)
=(301.532 / 1609.708) / (309.189 / 1703.698)
=0.18732093 / 0.18148111
=1.0322

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 - (194.37 + 126.344) / 414.822) / (1 - (184.434 + 65.956) / 320.77)
=0.22686357 / 0.21940955
=1.034

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
=1703.698 / 1609.708
=1.0584

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))
=(21.173 / (21.173 + 65.956)) / (28.401 / (28.401 + 126.344))
=0.24300749 / 0.1835342
=1.324

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)
=(219.968 / 1703.698) / (199.148 / 1609.708)
=0.12911208 / 0.12371685
=1.0436

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)
=((40.611 + 202.903) / 414.822) / ((0 + 181.648) / 320.77)
=0.58703251 / 0.56628737
=1.0366

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
=(10.564 - 10.014 - 75.401) / 414.822
=-0.1804

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.

Overstock.com Inc has a M-score of -3.08 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.

Overstock.com Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.17780.99850.58031.55170.93720.56862.47810.4350.94430.7168
GMI 1.21560.71670.96550.9251.07991.02430.94110.95061.01871.0143
AQI 0.84820.39160.60120.89211.17471.46160.96838.08760.80491.1445
SGI 0.9860.96451.09171.05651.24310.96731.04271.18641.14791.1074
DEPI 0.52940.70371.08631.25231.11780.87680.90791.24141.35161.2191
SGAI 1.08350.8580.91211.01910.9011.73750.58891.11550.98821.0297
LVGI 1.06061.19781.08140.66751.19931.15710.89710.75161.05050.9867
TATA -0.2969-0.2366-0.0884-0.1924-0.0207-0.2527-0.09430.0031-0.1941-0.1298
M-score -3.75-4.09-3.38-2.77-2.34-4.08-1.470.11-3.35-3.16

Overstock.com Inc Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.86080.93890.89270.94430.84790.86450.98060.71681.12921.1513
GMI 0.96380.99531.01921.01871.0141.00141.00051.01431.02021.0322
AQI 7.37498.29542.96470.80490.87090.86151.36731.14451.02541.034
SGI 1.16061.14151.14071.14791.16561.17261.1571.10741.07651.0584
DEPI 1.25561.251.38631.35161.14651.24031.13551.21911.30551.324
SGAI 1.13311.10871.0590.98820.99541.00911.03991.02971.02811.0436
LVGI 0.71010.70480.76891.05051.06611.08890.9530.98670.98321.0366
TATA 0.08960.09940.0253-0.1941-0.1908-0.1772-0.1335-0.1298-0.1458-0.1804
M-score 0.611.11-1.42-3.35-3.41-3.34-2.81-3.16-2.92-3.08
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK