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Unit Corp (NYSE:UNT)
Beneish M-Score
-2.84 (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 -2.84 suggests that the company is not a manipulator.

UNT' s 10-Year Beneish M-Score Range
Min: -4.79   Max: 14.85
Current: -2.84

-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 -2.80.


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 * 1.0816+0.528 * 0.9655+0.404 * 0.8638+0.892 * 1.17+0.115 * 0.9612
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9203+4.679 * -0.108-0.327 * 1.0403
=-2.84

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $179 Mil.
Revenue was 400.974 + 405.431 + 387.988 + 359.121 = $1,554 Mil.
Gross Profit was 206.848 + 215.566 + 202.809 + 183.25 = $808 Mil.
Total Current Assets was $220 Mil.
Total Assets was $4,432 Mil.
Property, Plant and Equipment(Net PPE) was $4,125 Mil.
Depreciation, Depletion and Amortization(DDA) was $386 Mil.
Selling, General & Admin. Expense(SGA) was $40 Mil.
Total Current Liabilities was $351 Mil.
Long-Term Debt was $677 Mil.
Net Income was 67.522 + 54.36 + 56.945 + 51.301 = $230 Mil.
Non Operating Income was 19.773 + -10.758 + -18.246 + -5.038 = $-14 Mil.
Cash Flow from Operations was 223.999 + 202.068 + 123.46 + 173.37 = $723 Mil.
Accounts Receivable was $142 Mil.
Revenue was 333.776 + 340.421 + 318.532 + 335.043 = $1,328 Mil.
Gross Profit was 161.551 + 172.28 + 160.082 + 173.273 = $667 Mil.
Total Current Assets was $182 Mil.
Total Assets was $3,925 Mil.
Property, Plant and Equipment(Net PPE) was $3,654 Mil.
Depreciation, Depletion and Amortization(DDA) was $327 Mil.
Selling, General & Admin. Expense(SGA) was $38 Mil.
Total Current Liabilities was $230 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)
=(179.464 / 1553.514) / (141.817 / 1327.772)
=0.11552133 / 0.10680825
=1.0816

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)
=(215.566 / 1327.772) / (206.848 / 1553.514)
=0.50248537 / 0.52041565
=0.9655

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 - (220.127 + 4124.648) / 4431.811) / (1 - (181.575 + 3653.892) / 3924.695)
=0.01963892 / 0.02273502
=0.8638

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
=1553.514 / 1327.772
=1.17

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))
=(327.261 / (327.261 + 3653.892)) / (385.729 / (385.729 + 4124.648))
=0.08220257 / 0.08552035
=0.9612

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)
=(40.444 / 1553.514) / (37.56 / 1327.772)
=0.02603388 / 0.02828799
=0.9203

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)
=((676.843 + 351.339) / 4431.811) / ((645.584 + 229.655) / 3924.695)
=0.23200042 / 0.22300816
=1.0403

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
=(230.128 - -14.269 - 722.897) / 4431.811
=-0.108

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 -2.84 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.92341.25690.76440.79811.02950.73961.40850.92680.81190.9311
GMI 0.99140.87860.90121.06180.95921.03231.04731.01311.00021.0445
AQI 0.89331.00091.20970.88040.87231.0730.78280.86610.88940.9288
SGI 1.71591.70571.31250.99691.1720.52271.24221.37031.08831.0279
DEPI 0.89440.98880.9121.0440.92961.23781.0270.90491.03551.0209
SGAI 0.75750.70150.99281.18270.98421.80710.87680.83871.01151.1268
LVGI 2.30451.29190.82040.70391.21770.39551.91581.35511.55950.9004
TATA -0.111-0.07-0.101-0.1386-0.2116-0.245-0.0913-0.1267-0.1772-0.1196
M-score -2.88-2.05-2.81-3.26-3.44-4.16-2.65-2.96-3.63-3.07

Unit Corp Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.880.87870.81190.90860.98520.88130.93111.13330.99771.0816
GMI 1.03951.0361.00020.99941.02191.0321.04451.02440.99180.9655
AQI 0.91030.70940.88940.94210.8840.94870.92880.92590.84550.8638
SGI 1.31911.18861.08831.00610.9851.00161.02791.09231.13311.17
DEPI 0.90031.04811.03551.09051.170.99321.02090.98940.9560.9612
SGAI 0.84650.92011.01151.14521.17911.18371.12681.03490.98410.9203
LVGI 1.16011.52941.55951.61221.4740.95470.90040.90790.9671.0403
TATA -0.1568-0.1495-0.1772-0.1847-0.1574-0.1524-0.1196-0.0962-0.1022-0.108
M-score -3.09-3.38-3.63-3.66-3.45-3.32-3.07-2.72-2.90-2.84
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