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Bankrate Inc (NYSE:RATE)
Beneish M-Score
-2.42 (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.

Bankrate Inc has a M-score of -2.42 suggests that the company is not a manipulator.

RATE' s 10-Year Beneish M-Score Range
Min: -4.48   Max: 2.07
Current: -2.42

-4.48
2.07

During the past 13 years, the highest Beneish M-Score of Bankrate Inc was 2.07. The lowest was -4.48. And the median was -2.41.


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 Bankrate 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 * 1.1945+0.528 * 1.1802+0.404 * 1.0681+0.892 * 0.8525+0.115 * 0.9175
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.7771+4.679 * -0.0264-0.327 * 1.0368
=-2.42

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $79.8 Mil.
Revenue was 141.541 + 0 + 141.649 + 130.662 = $413.9 Mil.
Gross Profit was 62.792 + 0 + 87.187 + 84.168 = $234.1 Mil.
Total Current Assets was $260.0 Mil.
Total Assets was $1,260.5 Mil.
Property, Plant and Equipment(Net PPE) was $14.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $104.7 Mil.
Selling, General & Admin. Expense(SGA) was $129.4 Mil.
Total Current Liabilities was $71.6 Mil.
Long-Term Debt was $297.7 Mil.
Net Income was 4.953 + 0 + 8.263 + -2.246 = $11.0 Mil.
Non Operating Income was -10.552 + 0 + -10.464 + -10.318 = $-31.3 Mil.
Cash Flow from Operations was 24.723 + 42.507 + 0 + 8.314 = $75.5 Mil.
Accounts Receivable was $78.4 Mil.
Revenue was 136.475 + 122.26 + 121.178 + 105.546 = $485.5 Mil.
Gross Profit was 90.18 + 85.245 + 80.654 + 68.074 = $324.2 Mil.
Total Current Assets was $336.4 Mil.
Total Assets was $1,311.4 Mil.
Property, Plant and Equipment(Net PPE) was $14.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $60.1 Mil.
Selling, General & Admin. Expense(SGA) was $195.3 Mil.
Total Current Liabilities was $73.5 Mil.
Long-Term Debt was $297.2 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)
=(79.807 / 413.852) / (78.371 / 485.459)
=0.19283947 / 0.16143691
=1.1945

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)
=(0 / 485.459) / (62.792 / 413.852)
=0.66772477 / 0.56577472
=1.1802

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 - (260.039 + 14.176) / 1260.479) / (1 - (336.43 + 14.265) / 1311.433)
=0.78245175 / 0.73258642
=1.0681

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
=413.852 / 485.459
=0.8525

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))
=(60.077 / (60.077 + 14.265)) / (104.684 / (104.684 + 14.176))
=0.80811654 / 0.88073364
=0.9175

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)
=(129.375 / 413.852) / (195.279 / 485.459)
=0.31261175 / 0.40225642
=0.7771

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)
=((297.748 + 71.646) / 1260.479) / ((297.162 + 73.528) / 1311.433)
=0.29305843 / 0.28266027
=1.0368

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
=(10.97 - -31.334 - 75.544) / 1260.479
=-0.0264

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.

Bankrate Inc has a M-score of -2.42 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.

Bankrate Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Jun14
DSRI 1.62631.10081.00470.67860.75321.90150.73680.80611.1773
GMI 1.00981.0780.94131.20821.06540.92430.9270.9731.015
AQI 4.03640.39061.26772.18211.11981.02471.03560.99250.8753
SGI 1.25111.62391.20021.74550.7881.67781.9231.07771.0006
DEPI 0.80510.78140.9710.76880.89941.02771.02440.98461.0213
SGAI 0.41962.16240.91170.8081.35160.65081.24361.23111.0218
LVGI 2.04720.23451.33751.71555.58970.80180.59870.96131.389
TATA -0.0815-0.0238-0.0361-0.0851-0.1169-0.0468-0.0397-0.0436-0.0757
M-score -1.09-2.12-2.49-2.15-4.93-1.17-2.02-2.84-2.84

Bankrate Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 0.80610.99390.98041.26321.17731.20111.10061.1945
GMI 0.97320.99741.03261.04261.01481.01450.99811.1802
AQI 0.99250.99150.98320.90350.87530.86070.91491.0681
SGI 1.07770.97880.89490.89691.00061.10181.20410.8525
DEPI 0.98460.99270.99921.00351.02131.03751.01490.9175
SGAI 1.23061.17171.13971.06791.02221.00061.03650.7771
LVGI 0.96131.01951.02021.35641.3891.31031.28941.0368
TATA -0.0436-0.0508-0.0638-0.0587-0.082-0.0729-0.0493-0.0264
M-score -2.84-2.78-2.91-2.75-2.87-2.69-2.57-2.42
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