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Unit Corporation (NYSE:UNT)
Beneish M-Score
-3.08 (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 Corporation has a M-score of -3.08 suggests that the company is not a manipulator.

UNT' s 10-Year Beneish M-Score Range
Min: -4.07   Max: 14.85
Current: -3.08

-4.07
14.85

During the past 13 years, the highest Beneish M-Score of Unit Corporation was 14.85. The lowest was -4.07. And the median was -2.85.


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 Corporation 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 * 0.9254+0.528 * 1.0445+0.404 * 0.9288+0.892 * 1.0279+0.115 * 1.0209
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1268+4.679 * -0.1196-0.327 * 0.9004
=-3.08

* 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 $140 Mil.
Revenue was 359.121 + 333.776 + 340.421 + 318.532 = $1,352 Mil.
Gross Profit was 183.25 + 161.551 + 172.28 + 160.082 = $677 Mil.
Total Current Assets was $212 Mil.
Total Assets was $4,022 Mil.
Property, Plant and Equipment(Net PPE) was $3,723 Mil.
Depreciation, Depletion and Amortization(DDA) was $334 Mil.
Selling, General & Admin. Expense(SGA) was $38 Mil.
Total Current Liabilities was $244 Mil.
Long-Term Debt was $646 Mil.
Net Income was 51.301 + 34.232 + 59.007 + 40.206 = $185 Mil.
Non Operating Income was -5.038 + -13.774 + 16.253 + -6.074 = $-9 Mil.
Cash Flow from Operations was 173.37 + 183.073 + 138.228 + 179.66 = $674 Mil.
Accounts Receivable was $147 Mil.
Revenue was 331.582 + 321.79 + 327.785 + 333.966 = $1,315 Mil.
Gross Profit was 169.812 + 166.388 + 177.324 + 174.571 = $688 Mil.
Total Current Assets was $196 Mil.
Total Assets was $3,761 Mil.
Property, Plant and Equipment(Net PPE) was $3,477 Mil.
Depreciation, Depletion and Amortization(DDA) was $319 Mil.
Selling, General & Admin. Expense(SGA) was $33 Mil.
Total Current Liabilities was $207 Mil.
Long-Term Debt was $716 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)
=(139.788 / 1351.85) / (146.947 / 1315.123)
=0.10340496 / 0.11173632
=0.9254

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)
=(161.551 / 1315.123) / (183.25 / 1351.85)
=0.52321722 / 0.50091578
=1.0445

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 - (212.031 + 3722.691) / 4022.39) / (1 - (195.644 + 3477.222) / 3761.12)
=0.021795 / 0.02346482
=0.9288

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
=1351.85 / 1315.123
=1.0279

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))
=(319.021 / (319.021 + 3477.222)) / (333.907 / (333.907 + 3722.691))
=0.08403598 / 0.08231208
=1.0209

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)
=(38.323 / 1351.85) / (33.086 / 1315.123)
=0.02834856 / 0.0251581
=1.1268

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)
=((645.696 + 243.573) / 4022.39) / ((716.359 + 207.139) / 3761.12)
=0.22107976 / 0.24553803
=0.9004

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
=(184.746 - -8.633 - 674.331) / 4022.39
=-0.1196

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 Corporation has a M-score of -3.08 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 Corporation Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.9181.25690.76440.82571.05610.83971.41340.76710.81630.9254
GMI 0.98580.87860.90121.06180.95921.03231.05941.00220.99951.0445
AQI 0.89331.00091.20970.88040.87231.0730.78280.86610.88940.9288
SGI 1.72281.70571.31250.99691.1720.52271.22651.38691.08911.0279
DEPI 0.89440.98880.9121.0440.92961.23781.0270.90491.03551.0209
SGAI 0.75450.70150.99281.18270.98421.80710.8880.82871.01081.1268
LVGI 2.30451.29190.82040.70391.21770.39551.91581.35511.55950.9004
TATA -0.111-0.07-0.101-0.1415-0.2116-0.245-0.0954-0.127-0.1772-0.1196
M-score -2.88-2.05-2.81-3.25-3.41-4.07-2.68-3.09-3.62-3.08

Unit Corporation Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 1.07130.76710.75860.76560.8060.81630.91021.00470.8940.9254
GMI 0.98241.00221.02181.03061.02510.99951.00091.02041.03651.0445
AQI 0.96730.86610.86620.91030.70940.88940.94210.8840.94870.9288
SGI 1.36891.38691.41971.33251.2031.08911.00430.98640.9971.0279
DEPI 0.86430.90490.90810.90031.04811.03551.09051.170.99321.0209
SGAI 0.80480.82870.79390.8380.90911.01081.14711.17741.18911.1268
LVGI 1.50851.35511.16341.16011.52941.55951.61221.4740.95470.9004
TATA -0.1097-0.127-0.1284-0.157-0.1487-0.1773-0.1852-0.1575-0.1535-0.1196
M-score -2.77-3.09-3.00-3.19-3.43-3.62-3.66-3.43-3.32-3.08
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