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Unit Corp (NYSE:UNT)
Beneish M-Score
-4.48 (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.

Unit Corp has a M-score of -4.48 suggests that the company is not a manipulator.

UNT' s 10-Year Beneish M-Score Range
Min: -4.79   Max: 14.85
Current: -4.48

-4.79
14.85

During the past 13 years, the highest Beneish M-Score of Unit Corp was 14.85. The lowest was -4.79. And the median was -2.84.


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 Unit 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 * 0.7262+0.528 * 1.0866+0.404 * 1.184+0.892 * 0.8404+0.115 * 0.7753
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.2069+4.679 * -0.3313-0.327 * 1.3555
=-4.48

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $108 Mil.
Revenue was 214.447 + 255.099 + 378.551 + 400.974 = $1,249 Mil.
Gross Profit was 91.398 + 113.967 + 178.041 + 206.848 = $590 Mil.
Total Current Assets was $167 Mil.
Total Assets was $3,630 Mil.
Property, Plant and Equipment(Net PPE) was $3,376 Mil.
Depreciation, Depletion and Amortization(DDA) was $411 Mil.
Selling, General & Admin. Expense(SGA) was $41 Mil.
Total Current Liabilities was $178 Mil.
Long-Term Debt was $927 Mil.
Net Income was -274.389 + -248.354 + -42.551 + 67.522 = $-498 Mil.
Non Operating Income was -1.895 + 6.584 + 39.308 + 19.773 = $64 Mil.
Cash Flow from Operations was 97.297 + 160.309 + 159.466 + 223.999 = $641 Mil.
Accounts Receivable was $177 Mil.
Revenue was 405.431 + 387.988 + 359.121 + 333.776 = $1,486 Mil.
Gross Profit was 215.566 + 202.809 + 183.25 + 161.551 = $763 Mil.
Total Current Assets was $211 Mil.
Total Assets was $4,278 Mil.
Property, Plant and Equipment(Net PPE) was $3,980 Mil.
Depreciation, Depletion and Amortization(DDA) was $365 Mil.
Selling, General & Admin. Expense(SGA) was $40 Mil.
Total Current Liabilities was $315 Mil.
Long-Term Debt was $646 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)
=(108.109 / 1249.071) / (177.149 / 1486.316)
=0.08655153 / 0.11918663
=0.7262

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)
=(113.967 / 1486.316) / (91.398 / 1249.071)
=0.5134682 / 0.4725544
=1.0866

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 - (166.534 + 3376.296) / 3629.993) / (1 - (211.266 + 3979.665) / 4277.682)
=0.02401189 / 0.02027991
=1.184

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
=1249.071 / 1486.316
=0.8404

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))
=(365.351 / (365.351 + 3979.665)) / (410.706 / (410.706 + 3376.296))
=0.08408508 / 0.10845149
=0.7753

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)
=(40.78 / 1249.071) / (40.208 / 1486.316)
=0.03264826 / 0.02705212
=1.2069

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)
=((926.908 + 177.9) / 3629.993) / ((645.925 + 314.55) / 4277.682)
=0.30435541 / 0.22453165
=1.3555

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
=(-497.772 - 63.77 - 641.071) / 3629.993
=-0.3313

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.

Unit Corp has a M-score of -4.48 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.

Unit Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.25690.76440.79811.02950.73961.40850.92680.81190.93111.167
GMI 0.87860.90121.06180.95921.03231.04731.01311.00021.04450.9809
AQI 1.00091.20970.88040.87231.0730.78280.86610.88940.92880.9009
SGI 1.70571.31250.99691.1720.52271.24221.37031.08831.02791.1635
DEPI 0.98880.9121.0440.92961.23781.0270.90491.03551.02090.9225
SGAI 0.70150.99281.18270.98421.80710.87680.83871.01151.12680.9424
LVGI 1.29190.82040.70391.21770.39551.91581.35511.55950.90041.1287
TATA -0.07-0.101-0.1415-0.2116-0.245-0.0913-0.1267-0.1772-0.1196-0.1347
M-score -2.05-2.81-3.28-3.44-4.16-2.65-2.96-3.63-3.07-2.90

Unit Corp Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 0.90860.98520.88130.93111.13330.99771.08161.1670.70450.7262
GMI 0.99941.02191.0321.04451.02440.99180.96550.98091.02091.0866
AQI 0.94210.8840.94870.92880.92590.84550.86380.90091.01711.184
SGI 1.00610.9851.00161.02791.09231.13311.171.16351.01320.8404
DEPI 1.09051.170.99321.02090.98940.9560.96120.92250.82990.7753
SGAI 1.14521.17911.18371.12681.03490.98410.92030.94241.0491.2069
LVGI 1.61221.4740.95470.90040.90790.9671.04031.12871.21921.3555
TATA -0.1847-0.1573-0.1524-0.1196-0.0962-0.1022-0.108-0.1347-0.2394-0.3313
M-score -3.66-3.44-3.32-3.07-2.72-2.90-2.84-2.90-3.94-4.48
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