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Bankrate Inc (NYSE:RATE)
Beneish M-Score
-2.69 (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 -2.69 suggests that the company is not a manipulator.

RATE' s 10-Year Beneish M-Score Range
Min: -4.89   Max: 2.07
Current: -2.69

-4.89
2.07

During the past 13 years, the highest Beneish M-Score of Bankrate Inc was 2.07. The lowest was -4.89. And the median was -2.28.


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 * 1.2011+0.528 * 1.0143+0.404 * 0.8607+0.892 * 1.1018+0.115 * 1.0375
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0019+4.679 * -0.0729-0.327 * 1.3103
=-2.69

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
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.
Net Income was 4.832 + -3.542 + -7.751 + -0.892 = $-7.4 Mil.
Non Operating Income was 0 + 6.24 + -19.317 + 2.949 = $-10.1 Mil.
Cash Flow from Operations was 5.444 + 47.355 + 18.674 + 26.856 = $98.3 Mil.
Accounts Receivable was $59.2 Mil.
Revenue was 108.448 + 93.244 + 116.775 + 122.125 = $440.6 Mil.
Gross Profit was 72.34 + 62.456 + 79.093 + 84.516 = $298.4 Mil.
Total Current Assets was $163.3 Mil.
Total Assets was $1,168.9 Mil.
Property, Plant and Equipment(Net PPE) was $10.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $55.6 Mil.
Selling, General & Admin. Expense(SGA) was $176.9 Mil.
Total Current Liabilities was $58.1 Mil.
Long-Term Debt was $194.0 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)
=(78.371 / 485.459) / (59.221 / 440.592)
=0.16143691 / 0.13441234
=1.2011

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)
=(85.245 / 440.592) / (90.18 / 485.459)
=0.67728193 / 0.66772477
=1.0143

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 - (336.43 + 14.265) / 1311.433) / (1 - (163.264 + 10.716) / 1168.928)
=0.73258642 / 0.85116277
=0.8607

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
=485.459 / 440.592
=1.1018

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))
=(55.596 / (55.596 + 10.716)) / (60.077 / (60.077 + 14.265))
=0.83840029 / 0.80811654
=1.0375

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)
=(195.279 / 485.459) / (176.894 / 440.592)
=0.40225642 / 0.40149163
=1.0019

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)
=((297.162 + 73.528) / 1311.433) / ((194.033 + 58.121) / 1168.928)
=0.28266027 / 0.21571388
=1.3103

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
=(-7.353 - -10.128 - 98.329) / 1311.433
=-0.0729

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 -2.69 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.41261.55571.09041.00470.67860.75321.90150.73680.80611.1773
GMI 1.0251.00981.0780.94131.20821.06540.92430.92740.97261.015
AQI 9.02884.03640.39061.26772.18211.11981.02471.03560.99250.8753
SGI 1.07051.25111.62391.20021.74550.7881.67781.9231.07771.0006
DEPI 1.2520.80510.78140.9710.76880.89941.02771.02440.98461.0213
SGAI 0.98340.41962.16240.91170.8081.35160.65081.23951.23521.0218
LVGI 0.57442.04720.23451.33751.71555.58970.80180.59870.96131.389
TATA 0.1283-0.0815-0.0238-0.0361-0.0851-0.1169-0.0468-0.0394-0.0413-0.0757
M-score 1.99-1.16-2.13-2.49-2.15-4.93-1.17-2.01-2.83-2.84

Bankrate Inc Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.73680.6990.78640.70890.80610.99390.98041.26321.17731.2011
GMI 0.92740.91390.90820.92490.97260.99751.0331.04311.01531.0143
AQI 1.03560.96930.99711.00770.99250.99150.98320.90350.87530.8607
SGI 1.9231.57821.37181.23211.07770.97880.89490.89691.00061.1018
DEPI 1.02441.00381.02940.9850.98460.99270.99921.00351.02131.0375
SGAI 1.23951.31131.30241.26411.23521.17231.1391.06651.02051.0019
LVGI 0.59870.65080.97680.99690.96131.01951.02021.35641.3891.3103
TATA -0.0394-0.047-0.0541-0.0547-0.042-0.0482-0.0609-0.0574-0.0811-0.0729
M-score -2.01-2.46-2.69-2.88-2.83-2.77-2.90-2.74-2.87-2.69
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