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PS Business Parks Inc (NYSE:PSB)
Beneish M-Score
-3.25 (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.

PS Business Parks Inc has a M-score of -3.25 suggests that the company is not a manipulator.

PSB' s Beneish M-Score Range Over the Past 10 Years
Min: -4.24   Max: 13.63
Current: -3.25

-4.24
13.63

During the past 13 years, the highest Beneish M-Score of PS Business Parks Inc was 13.63. The lowest was -4.24. And the median was -2.79.


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 PS Business Parks 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 * 1.0822+0.528 * 0.9978+0.404 * 0.2305+0.892 * 0.9775+0.115 * 1.0306
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 2.2273+4.679 * -0.0658-0.327 * 0.9907
=-3.25

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $3.8 Mil.
Revenue was 93.452 + 93.081 + 92.462 + 91.486 = $370.5 Mil.
Gross Profit was 63.004 + 63.024 + 60.716 + 62.196 = $248.9 Mil.
Total Current Assets was $284.1 Mil.
Total Assets was $2,264.5 Mil.
Property, Plant and Equipment(Net PPE) was $1,943.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $106.1 Mil.
Selling, General & Admin. Expense(SGA) was $14.9 Mil.
Total Current Liabilities was $80.7 Mil.
Long-Term Debt was $250.0 Mil.
Net Income was 40.19 + 26.293 + 34.991 + 97.472 = $198.9 Mil.
Non Operating Income was 15.748 + 0 + 12.487 + 92.373 = $120.6 Mil.
Cash Flow from Operations was 67.17 + 57.182 + 54.263 + 48.813 = $227.4 Mil.
Accounts Receivable was $3.6 Mil.
Revenue was 95.791 + 94.151 + 95.487 + 93.586 = $379.0 Mil.
Gross Profit was 62.689 + 62.616 + 62.043 + 66.76 = $254.1 Mil.
Total Current Assets was $89.2 Mil.
Total Assets was $2,242.0 Mil.
Property, Plant and Equipment(Net PPE) was $1,992.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $112.3 Mil.
Selling, General & Admin. Expense(SGA) was $6.8 Mil.
Total Current Liabilities was $80.5 Mil.
Long-Term Debt was $250.0 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)
=(3.788 / 370.481) / (3.581 / 379.015)
=0.01022455 / 0.00944817
=1.0822

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)
=(63.024 / 379.015) / (63.004 / 370.481)
=0.67044312 / 0.67193729
=0.9978

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 - (284.077 + 1943.227) / 2264.537) / (1 - (89.152 + 1992.928) / 2242.01)
=0.01644177 / 0.07133331
=0.2305

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
=370.481 / 379.015
=0.9775

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))
=(112.277 / (112.277 + 1992.928)) / (106.053 / (106.053 + 1943.227))
=0.05333305 / 0.05175135
=1.0306

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)
=(14.883 / 370.481) / (6.836 / 379.015)
=0.0401721 / 0.01803623
=2.2273

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)
=((250 + 80.662) / 2264.537) / ((250 + 80.454) / 2242.01)
=0.14601749 / 0.14739185
=0.9907

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
=(198.946 - 120.608 - 227.428) / 2264.537
=-0.0658

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.

PS Business Parks Inc has a M-score of -3.25 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.

PS Business Parks Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 110.9185011.04220.11691.27651.0650.5163
GMI 1.0011.01311.00470.9981.01011.00941.01880.99040.98591.0285
AQI 3.41886.32250.05110.42670.20651.79812.36430.38489.72160.2384
SGI 1.04081.10291.1181.03810.96391.01951.07651.16451.03651.0473
DEPI 0.90630.059115.64320.95121.11751.2631.22250.78350.96970.984
SGAI 1.21311.09341.0050.98540.79451.52640.86970.84760.57462.4516
LVGI 2.12692.58980.87411.79720.88081.92642.97950.68670.57920.9896
TATA -0.0502-0.0694-0.0761-0.0812-0.0655-0.0566-0.0405-0.0558-0.0532-0.0656
M-score -2.12-1.20-1.46-4.24-3.05-2.72-3.45-2.491.09-3.73

PS Business Parks Inc Quarterly Data

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 0.80980.96941.0655.37930.87930.73360.51630.1631.01661.0822
GMI 1.00110.99520.98590.99230.99471.0011.02851.01851.01050.9978
AQI 0.29650.37379.72162.900910.405810.22960.23841.0090.37610.2305
SGI 1.09611.06961.03651.04691.05731.06561.04731.01850.99910.9775
DEPI 0.90190.94380.96971.00970.94450.9310.9840.95711.02151.0306
SGAI 0.78960.77910.57460.57020.67160.68262.45162.64572.29912.2273
LVGI 0.68240.80550.57920.75230.75230.75840.98960.99110.9970.9907
TATA -0.0556-0.0575-0.0532-0.0534-0.0566-0.0563-0.0656-0.066-0.0636-0.0658
M-score -2.98-2.881.092.261.120.92-3.73-3.81-3.23-3.25
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