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PS Business Parks, Inc. (NYSE:PSB)
Beneish M-Score
-2.51 (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 -2.51 suggests that the company is not a manipulator.

PSB' s 10-Year Beneish M-Score Range
Min: -4.24   Max: -1.19
Current: -2.51

-4.24
-1.19

During the past 13 years, the highest Beneish M-Score of PS Business Parks, Inc. was -1.19. The lowest was -4.24. And the median was -2.51.


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 * 1.065+0.528 * 0.9859+0.404 * 0.8045+0.892 * 1.0365+0.115 * 1.0368
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.5746+4.679 * -0.0532-0.327 * 0.5792
=-2.51

* 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 $5.2 Mil.
Revenue was 93.586 + 89.934 + 88.087 + 88.278 = $359.9 Mil.
Gross Profit was 66.76 + 60.033 + 59.367 + 58.894 = $245.1 Mil.
Total Current Assets was $62.6 Mil.
Total Assets was $2,238.6 Mil.
Property, Plant and Equipment(Net PPE) was $2,162.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $108.9 Mil.
Selling, General & Admin. Expense(SGA) was $5.3 Mil.
Total Current Liabilities was $73.9 Mil.
Long-Term Debt was $250.0 Mil.
Net Income was 32.755 + 24.151 + 23.863 + 22.423 = $103.2 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.0 Mil.
Cash Flow from Operations was 56.489 + 60.196 + 53.083 + 52.526 = $222.3 Mil.
Accounts Receivable was $4.8 Mil.
Revenue was 89.384 + 87.179 + 85.791 + 84.843 = $347.2 Mil.
Gross Profit was 60.402 + 57.885 + 58.074 + 56.728 = $233.1 Mil.
Total Current Assets was $43.0 Mil.
Total Assets was $2,151.8 Mil.
Property, Plant and Equipment(Net PPE) was $2,093.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $109.5 Mil.
Selling, General & Admin. Expense(SGA) was $8.9 Mil.
Total Current Liabilities was $69.5 Mil.
Long-Term Debt was $468.1 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)
=(5.248 / 359.885) / (4.754 / 347.197)
=0.01458244 / 0.01369251
=1.065

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)
=(60.033 / 347.197) / (66.76 / 359.885)
=0.67134509 / 0.68092307
=0.9859

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 - (62.632 + 2162.653) / 2238.559) / (1 - (42.966 + 2092.99) / 2151.817)
=0.00592971 / 0.00737098
=0.8045

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
=359.885 / 347.197
=1.0365

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))
=(109.494 / (109.494 + 2092.99)) / (108.917 / (108.917 + 2162.653))
=0.04971387 / 0.0479479
=1.0368

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)
=(5.312 / 359.885) / (8.919 / 347.197)
=0.01476027 / 0.02568859
=0.5746

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 + 73.919) / 2238.559) / ((468.102 + 69.454) / 2151.817)
=0.14469978 / 0.24981492
=0.5792

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
=(103.192 - 0 - 222.294) / 2238.559
=-0.0532

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 -2.51 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 110.91850.94421.04721.04220.11691.27651.065
GMI 1.04211.01311.00470.9981.01011.00941.01880.99040.9859
AQI 0.79566.32250.05110.42670.20651.79812.36430.38480.8045
SGI 1.15861.10291.1181.03810.96391.01951.07651.16451.0365
DEPI 0.94560.059115.64320.95121.11751.2631.22250.78351.0368
SGAI 01.09341.0050.98540.79451.52640.86970.84760.5746
LVGI 0.13692.58980.87411.79720.88081.92642.97950.68670.5792
TATA -0.0659-0.0694-0.0761-0.0822-0.0655-0.0566-0.0405-0.0558-0.0532
M-score -2.26-1.20-1.46-3.38-3.00-2.72-3.45-2.49-2.51

PS Business Parks, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 0.12140.11710.83111.50361.18351.27671.34470.80980.96941.065
GMI 1.01371.01861.00850.99771.00330.99020.99721.00110.99520.9859
AQI 2.62312.36430.86150.90610.81480.38480.28680.29650.37370.8045
SGI 1.07091.07481.08991.12051.13091.16431.13351.09611.06961.0365
DEPI 0.99871.22251.17671.12031.08750.78350.84270.90190.94381.0368
SGAI 0.83180.87111.05471.18721.35610.84770.81940.78960.77910.5746
LVGI 1.47052.97952.4051.93821.55860.68670.57640.68240.80550.5792
TATA -0.0549-0.0405-0.0487-0.0495-0.0487-0.0558-0.0541-0.0556-0.0575-0.0532
M-score -2.94-3.45-3.28-2.51-2.73-2.49-2.44-2.98-2.88-2.51
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