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SanDisk Corp (NAS:SNDK)
Beneish M-Score
-2.95 (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.

SanDisk Corp has a M-score of -2.95 suggests that the company is not a manipulator.

SNDK' s Beneish M-Score Range Over the Past 10 Years
Min: -10.19   Max: 25.25
Current: -2.95

-10.19
25.25

During the past 13 years, the highest Beneish M-Score of SanDisk Corp was 25.25. The lowest was -10.19. And the median was -2.18.


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 SanDisk Corp 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 * 0.9784+0.528 * 1.1677+0.404 * 0.9648+0.892 * 0.8696+0.115 * 1.0255
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.2001+4.679 * -0.0716-0.327 * 1.1363
=-2.95

* 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 $741 Mil.
Revenue was 1452.285 + 1237.196 + 1332.241 + 1735.254 = $5,757 Mil.
Gross Profit was 602.83 + 484.379 + 545.002 + 739.77 = $2,372 Mil.
Total Current Assets was $3,614 Mil.
Total Assets was $9,073 Mil.
Property, Plant and Equipment(Net PPE) was $831 Mil.
Depreciation, Depletion and Amortization(DDA) was $626 Mil.
Selling, General & Admin. Expense(SGA) was $592 Mil.
Total Current Liabilities was $1,139 Mil.
Long-Term Debt was $2,138 Mil.
Net Income was 133.011 + 80.973 + 39.025 + 201.891 = $455 Mil.
Non Operating Income was -1.759 + 0 + 0 + 6.152 = $4 Mil.
Cash Flow from Operations was 274.972 + 28.864 + 308.865 + 487.813 = $1,101 Mil.
Accounts Receivable was $871 Mil.
Revenue was 1746.491 + 1634.011 + 1511.945 + 1727.858 = $6,620 Mil.
Gross Profit was 817.138 + 759.65 + 751.29 + 857.155 = $3,185 Mil.
Total Current Assets was $4,354 Mil.
Total Assets was $10,708 Mil.
Property, Plant and Equipment(Net PPE) was $692 Mil.
Depreciation, Depletion and Amortization(DDA) was $545 Mil.
Selling, General & Admin. Expense(SGA) was $567 Mil.
Total Current Liabilities was $2,215 Mil.
Long-Term Debt was $1,188 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)
=(740.637 / 5756.976) / (870.552 / 6620.305)
=0.12865035 / 0.13149726
=0.9784

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)
=(484.379 / 6620.305) / (602.83 / 5756.976)
=0.48113085 / 0.41201857
=1.1677

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 - (3613.646 + 831.064) / 9073.003) / (1 - (4354.134 + 692.362) / 10708.261)
=0.51011699 / 0.52872871
=0.9648

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
=5756.976 / 6620.305
=0.8696

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))
=(544.885 / (544.885 + 692.362)) / (625.588 / (625.588 + 831.064))
=0.44040115 / 0.42946977
=1.0255

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)
=(591.766 / 5756.976) / (567.065 / 6620.305)
=0.10279112 / 0.08565542
=1.2001

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)
=((2137.737 + 1139.01) / 9073.003) / ((1188.356 + 2214.946) / 10708.261)
=0.36115352 / 0.31782023
=1.1363

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
=(454.9 - 4.393 - 1100.514) / 9073.003
=-0.0716

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.

SanDisk Corp has a M-score of -2.95 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.

SanDisk Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.31620.63270.30661.80391.15941.20941.26380.95031.14860.8739
GMI 1.10861.232716.39780.05230.76851.08791.29310.71681.0041.1413
AQI 3.23461.40480.97970.9761.0991.05460.9111.00811.05540.5721
SGI 1.41261.19610.86011.06431.35331.17310.89231.22121.07420.8396
DEPI 0.79470.79330.86461.00460.94421.03191.15580.92980.93331.0282
SGAI 1.27721.09581.30120.66990.7320.80921.17481.02481.18831.1739
LVGI 1.66330.9711.26420.80511.01150.87140.97441.18661.07471.0657
TATA -0.0259-0.0612-0.343-0.0118-0.0209-0.0087-0.0101-0.0786-0.0676-0.0619
M-score -1.27-2.673.12-2.13-2.16-2.03-2.27-2.92-2.63-3.18

SanDisk Corp Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.25110.95031.11071.03531.14851.14860.97120.90560.97840.8739
GMI 0.78390.71680.7120.79880.90781.0041.0971.14131.16771.1413
AQI 0.92561.00811.09541.05361.09391.05541.0161.00590.96480.5721
SGI 1.1761.22121.22241.1541.10641.07421.01680.93110.86960.8396
DEPI 0.7850.92980.95660.96690.98270.93330.97881.00051.02551.0282
SGAI 1.02231.02481.00961.07291.16261.18831.24911.29521.20011.1739
LVGI 0.86731.18661.11671.46521.41271.07471.21331.21971.13631.0657
TATA -0.0708-0.0786-0.0597-0.0436-0.0644-0.0677-0.0902-0.0913-0.0716-0.0681
M-score -2.55-2.92-2.62-2.77-2.73-2.63-2.97-3.10-2.95-3.20
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