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Prestige Brands Holdings Inc (NYSE:PBH)
Beneish M-Score
-2.65 (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.

Prestige Brands Holdings Inc has a M-score of -2.65 suggests that the company is not a manipulator.

PBH' s 10-Year Beneish M-Score Range
Min: -4.19   Max: -2.16
Current: -2.65

-4.19
-2.16

During the past 13 years, the highest Beneish M-Score of Prestige Brands Holdings Inc was -2.16. The lowest was -4.19. And the median was -2.52.


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 Prestige Brands 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 * 0.8842+0.528 * 0.9554+0.404 * 0.9514+0.892 * 1.015+0.115 * 1.043
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9222+4.679 * -0.0135-0.327 * 0.951
=-2.65

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $66.2 Mil.
Revenue was 146.212 + 168.442 + 142.971 + 154.513 = $612.1 Mil.
Gross Profit was 81.809 + 94.719 + 83.483 + 88.07 = $348.1 Mil.
Total Current Assets was $244.5 Mil.
Total Assets was $1,864.8 Mil.
Property, Plant and Equipment(Net PPE) was $10.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $13.5 Mil.
Selling, General & Admin. Expense(SGA) was $140.8 Mil.
Total Current Liabilities was $134.1 Mil.
Long-Term Debt was $981.5 Mil.
Net Income was 3.13 + 32.792 + 20.692 + 19.349 = $76.0 Mil.
Non Operating Income was -15.012 + 0 + 0 + -1.443 = $-16.5 Mil.
Cash Flow from Operations was 25.262 + 32.8 + 22.798 + 36.729 = $117.6 Mil.
Accounts Receivable was $73.8 Mil.
Revenue was 160.232 + 161.855 + 146.997 + 133.996 = $603.1 Mil.
Gross Profit was 84.997 + 90.545 + 83.604 + 68.488 = $327.6 Mil.
Total Current Assets was $151.2 Mil.
Total Assets was $1,731.4 Mil.
Property, Plant and Equipment(Net PPE) was $9.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $13.0 Mil.
Selling, General & Admin. Expense(SGA) was $150.4 Mil.
Total Current Liabilities was $88.8 Mil.
Long-Term Debt was $1,000.3 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)
=(66.188 / 612.138) / (73.752 / 603.08)
=0.10812595 / 0.12229223
=0.8842

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)
=(94.719 / 603.08) / (81.809 / 612.138)
=0.54326789 / 0.56863158
=0.9554

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 - (244.501 + 10.528) / 1864.846) / (1 - (151.222 + 9.19) / 1731.389)
=0.86324394 / 0.90735069
=0.9514

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
=612.138 / 603.08
=1.015

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))
=(13.001 / (13.001 + 9.19)) / (13.494 / (13.494 + 10.528))
=0.58586814 / 0.56173508
=1.043

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)
=(140.756 / 612.138) / (150.366 / 603.08)
=0.22994161 / 0.24933011
=0.9222

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)
=((981.511 + 134.063) / 1864.846) / ((1000.3 + 88.75) / 1731.389)
=0.5982124 / 0.62900365
=0.951

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
=(75.963 - -16.455 - 117.589) / 1864.846
=-0.0135

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.

Prestige Brands Holdings Inc has a M-score of -2.65 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.

Prestige Brands Holdings Inc Annual Data

Mar04Mar05Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13
DSRI 0.69441.08630.81771.22670.87770.88061.26061.0350.8579
GMI 1.13150.97941.02051.00660.9840.99991.03270.9850.9259
AQI 1.02140.99251.00470.99720.94750.98561.04711.02090.9829
SGI 3.28791.02631.0741.0250.92820.96521.15011.31081.4138
DEPI 1.01920.94990.9850.99641.01781.00011.01870.98131.5584
SGAI 0.54181.03971.05661.0671.13580.96841.13311.02340.883
LVGI 1.07450.96310.92160.9021.20180.8671.15711.31940.9083
TATA -0.014-0.01760.0035-0.0107-0.3163-0.0312-0.0541-0.017-0.0406
M-score -0.65-2.47-2.54-2.28-4.25-2.72-2.40-2.36-2.36

Prestige Brands Holdings Inc Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.15930.91841.0351.15951.21080.98360.85790.71020.83310.8842
GMI 1.05381.01150.9850.95660.92290.93620.92590.94590.96660.9554
AQI 1.0571.08381.02091.01651.00441.01090.98290.98210.99630.9514
SGI 1.32221.30111.31081.36671.41591.49481.41381.25731.14031.015
DEPI 1.01760.98680.98131.0581.32281.52251.55841.51011.23321.043
SGAI 1.21880.99311.02341.05821.06631.04690.8830.83310.8380.9222
LVGI 1.1720.88651.31941.34971.36931.36290.90830.90110.90380.951
TATA -0.0437-0.0329-0.017-0.0138-0.0255-0.0397-0.0406-0.0419-0.0256-0.0135
M-score -2.29-2.36-2.36-2.20-2.17-2.34-2.36-2.63-2.56-2.65
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