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Overstock.com Inc (NAS:OSTK)
Beneish M-Score
-2.92 (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 -2.92 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: -2.92

-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 -3.02.


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 * 1.1292+0.528 * 1.0202+0.404 * 1.0254+0.892 * 1.0765+0.115 * 1.3055
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0281+4.679 * -0.1458-0.327 * 0.9832
=-2.92

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $19 Mil.
Revenue was 413.677 + 480.27 + 391.211 + 388.013 = $1,673 Mil.
Gross Profit was 77.307 + 83.109 + 72.451 + 73.657 = $307 Mil.
Total Current Assets was $197 Mil.
Total Assets was $392 Mil.
Property, Plant and Equipment(Net PPE) was $107 Mil.
Depreciation, Depletion and Amortization(DDA) was $27 Mil.
Selling, General & Admin. Expense(SGA) was $211 Mil.
Total Current Liabilities was $194 Mil.
Long-Term Debt was $27 Mil.
Net Income was 13.429 + 0.11 + -2.071 + 1.668 = $13 Mil.
Non Operating Income was 4.156 + 1.102 + 0.764 + 1.163 = $7 Mil.
Cash Flow from Operations was -34.503 + 90.916 + 11.467 + -4.778 = $63 Mil.
Accounts Receivable was $16 Mil.
Revenue was 398.344 + 470.36 + 352.991 + 332.545 = $1,554 Mil.
Gross Profit was 75.437 + 85.38 + 67.058 + 62.625 = $291 Mil.
Total Current Assets was $195 Mil.
Total Assets was $320 Mil.
Property, Plant and Equipment(Net PPE) was $55 Mil.
Depreciation, Depletion and Amortization(DDA) was $20 Mil.
Selling, General & Admin. Expense(SGA) was $191 Mil.
Total Current Liabilities was $184 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)
=(19.025 / 1673.171) / (15.651 / 1554.24)
=0.01137062 / 0.01006987
=1.1292

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)
=(83.109 / 1554.24) / (77.307 / 1673.171)
=0.18690807 / 0.18319945
=1.0202

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 - (196.876 + 106.869) / 392.058) / (1 - (195.066 + 54.947) / 320.398)
=0.22525494 / 0.2196799
=1.0254

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
=1673.171 / 1554.24
=1.0765

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))
=(19.645 / (19.645 + 54.947)) / (27.008 / (27.008 + 106.869))
=0.26336604 / 0.20173742
=1.3055

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)
=(211.453 / 1673.171) / (191.056 / 1554.24)
=0.12637859 / 0.12292567
=1.0281

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)
=((26.633 + 194.406) / 392.058) / ((0 + 183.733) / 320.398)
=0.56379158 / 0.57345239
=0.9832

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
=(13.136 - 7.185 - 63.102) / 392.058
=-0.1458

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 -2.92 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 1.18450.99850.57711.56020.93720.56862.47810.4350.94430.7168
GMI 1.24690.71670.97980.91151.07991.02430.94110.95061.01871.0143
AQI 0.84820.39160.60120.89211.17471.46160.96838.08760.80491.1445
SGI 0.98050.96451.09761.05081.24310.96731.04271.18641.14791.1074
DEPI 0.57410.70371.09381.24381.11780.87680.90791.24141.35161.2191
SGAI 0.83220.8580.89771.03540.9011.14510.89351.61670.68181.0297
LVGI 1.06061.19781.08140.66751.19931.15710.89710.75161.05050.9867
TATA -0.2969-0.2366-0.0727-0.1924-0.0207-0.2527-0.09430.0162-0.1941-0.1298
M-score -3.69-4.09-3.29-2.78-2.34-3.98-1.530.08-3.30-3.16

Overstock.com Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 0.4350.86080.93890.89270.94430.84790.86450.98060.71681.1292
GMI 0.95060.96380.99531.01921.01871.0141.00141.00051.01431.0202
AQI 8.08767.37498.29542.96470.80490.87090.86151.36731.14451.0254
SGI 1.18641.16061.14151.14071.14791.16561.17261.1571.10741.0765
DEPI 1.24141.25561.251.38631.35161.14651.24031.13551.21911.3055
SGAI 1.11551.13311.10871.0590.98820.99541.00911.03991.02971.0281
LVGI 0.75160.71010.70480.76891.05051.06611.08890.9530.98670.9832
TATA 0.00310.08960.09940.0253-0.1941-0.1908-0.1772-0.1335-0.1298-0.1458
M-score 0.110.611.11-1.42-3.35-3.41-3.34-2.81-3.16-2.92
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