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Unit Corp (NYSE:UNT)
Beneish M-Score
-2.90 (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 -2.90 suggests that the company is not a manipulator.

UNT' s 10-Year Beneish M-Score Range
Min: -4.79   Max: 14.85
Current: -2.9

-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 -2.79.


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 * 0.9981+0.528 * 0.9922+0.404 * 0.8455+0.892 * 1.1326+0.115 * 0.956
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9846+4.679 * -0.1022-0.327 * 0.967
=-2.90

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
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.
Net Income was 54.36 + 56.945 + 51.301 + 34.232 = $197 Mil.
Non Operating Income was -10.758 + -18.246 + -5.038 + -13.774 = $-48 Mil.
Cash Flow from Operations was 202.068 + 123.46 + 173.37 + 183.073 = $682 Mil.
Accounts Receivable was $157 Mil.
Revenue was 340.421 + 318.532 + 331.582 + 321.79 = $1,312 Mil.
Gross Profit was 172.28 + 160.082 + 169.812 + 166.388 = $669 Mil.
Total Current Assets was $200 Mil.
Total Assets was $3,900 Mil.
Property, Plant and Equipment(Net PPE) was $3,606 Mil.
Depreciation, Depletion and Amortization(DDA) was $315 Mil.
Selling, General & Admin. Expense(SGA) was $36 Mil.
Total Current Liabilities was $190 Mil.
Long-Term Debt was $715 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)
=(177.149 / 1486.316) / (156.706 / 1312.325)
=0.11918663 / 0.11941097
=0.9981

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)
=(202.809 / 1312.325) / (215.566 / 1486.316)
=0.5094485 / 0.5134682
=0.9922

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 - (211.266 + 3979.665) / 4277.682) / (1 - (199.669 + 3606.326) / 3899.524)
=0.02027991 / 0.02398472
=0.8455

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
=1486.316 / 1312.325
=1.1326

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))
=(315.25 / (315.25 + 3606.326)) / (365.351 / (365.351 + 3979.665))
=0.0803886 / 0.08408508
=0.956

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)
=(40.208 / 1486.316) / (36.058 / 1312.325)
=0.02705212 / 0.02747643
=0.9846

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)
=((645.925 + 314.55) / 4277.682) / ((715.474 + 189.931) / 3899.524)
=0.22453165 / 0.23218347
=0.967

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
=(196.838 - -47.816 - 681.971) / 4277.682
=-0.1022

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 -2.90 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 0.91971.25690.76440.79811.02950.73961.42660.91570.81130.9311
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 -2.88-2.05-2.81-3.28-3.44-4.16-2.67-2.96-3.63-3.07

Unit Corp Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.86720.87120.86820.81130.91020.98370.88530.93111.1320.9981
GMI 1.02181.03061.02510.99951.00091.02041.03651.04451.02330.9922
AQI 0.86620.91030.70940.88940.94210.8840.94870.92880.92590.8455
SGI 1.41971.33251.2031.08911.00430.98640.9971.02791.09361.1326
DEPI 0.90810.90031.04811.03551.09051.170.99321.02090.98940.956
SGAI 0.79390.8380.90911.01081.14711.17741.18911.12681.03370.9846
LVGI 1.16341.16011.52941.55951.61221.4740.95470.90040.90790.967
TATA -0.1284-0.157-0.1487-0.1773-0.1852-0.1575-0.1536-0.1196-0.0962-0.1022
M-score -2.90-3.09-3.37-3.63-3.66-3.45-3.33-3.07-2.72-2.90
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