Switch to:
United Rentals Inc (NYSE:URI)
Beneish M-Score
-3.29 (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.

United Rentals Inc has a M-score of -3.29 suggests that the company is not a manipulator.

URI' s Beneish M-Score Range Over the Past 10 Years
Min: -4.82   Max: -0.73
Current: -3.29

-4.82
-0.73

During the past 13 years, the highest Beneish M-Score of United Rentals Inc was -0.73. The lowest was -4.82. And the median was -2.99.


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 United Rentals Inc 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 * 0.9778+0.528 * 1.0363+0.404 * 0.9793+0.892 * 0.9918+0.115 * 0.9792
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9458+4.679 * -0.1727-0.327 * 0.9704
=-3.29

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $867 Mil.
Revenue was 1421 + 1310 + 1523 + 1550 = $5,804 Mil.
Gross Profit was 590 + 500 + 648 + 690 = $2,428 Mil.
Total Current Assets was $1,264 Mil.
Total Assets was $12,120 Mil.
Property, Plant and Equipment(Net PPE) was $6,762 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,249 Mil.
Selling, General & Admin. Expense(SGA) was $712 Mil.
Total Current Liabilities was $1,508 Mil.
Long-Term Debt was $7,265 Mil.
Net Income was 134 + 92 + 169 + 215 = $610 Mil.
Non Operating Income was 2 + 0 + 922 + -213 = $711 Mil.
Cash Flow from Operations was 643 + 604 + 438 + 307 = $1,992 Mil.
Accounts Receivable was $894 Mil.
Revenue was 1429 + 1315 + 1564 + 1544 = $5,852 Mil.
Gross Profit was 618 + 524 + 707 + 688 = $2,537 Mil.
Total Current Assets was $1,436 Mil.
Total Assets was $12,605 Mil.
Property, Plant and Equipment(Net PPE) was $6,821 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,229 Mil.
Selling, General & Admin. Expense(SGA) was $759 Mil.
Total Current Liabilities was $1,582 Mil.
Long-Term Debt was $7,820 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)
=(867 / 5804) / (894 / 5852)
=0.14937974 / 0.15276828
=0.9778

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)
=(2537 / 5852) / (2428 / 5804)
=0.433527 / 0.41833218
=1.0363

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 - (1264 + 6762) / 12120) / (1 - (1436 + 6821) / 12605)
=0.33778878 / 0.34494248
=0.9793

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
=5804 / 5852
=0.9918

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))
=(1229 / (1229 + 6821)) / (1249 / (1249 + 6762))
=0.15267081 / 0.15591062
=0.9792

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)
=(712 / 5804) / (759 / 5852)
=0.12267402 / 0.12969925
=0.9458

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)
=((7265 + 1508) / 12120) / ((7820 + 1582) / 12605)
=0.72384488 / 0.74589449
=0.9704

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
=(610 - 711 - 1992) / 12120
=-0.1727

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.

United Rentals Inc has a M-score of -3.29 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.

United Rentals Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.88741.0130.99471.02841.17921.05451.08390.84241.0190.9669
GMI 0.95761.00421.03041.32280.87950.85520.89220.96130.93741.0034
AQI 1.01940.92810.28241.12651.00741.32053.68780.93250.99660.9518
SGI 1.10711.02060.87940.72180.94871.16721.57681.20351.14731.0232
DEPI 1.0231.0570.94410.97010.99211.03760.97210.89511.01930.9893
SGAI 1.00130.95580.99451.08080.94820.95010.91620.90721.02910.9206
LVGI 0.90760.90641.62680.98551.00140.95740.86530.95381.040.9999
TATA -0.1182-0.1053-0.3503-0.1298-0.1302-0.1241-0.0598-0.1041-0.1051-0.1177
M-score -3.02-2.92-4.72-3.10-3.02-2.78-1.08-2.96-2.87-3.05

United Rentals Inc Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.941.02661.03941.0190.97480.94590.98440.96690.9840.9778
GMI 0.94680.93710.93730.93740.94550.95690.96871.00341.01941.0363
AQI 0.92641.00731.01740.99661.00220.9310.93890.95180.97640.9793
SGI 1.10351.09471.12191.14731.15681.11981.07311.02320.99830.9918
DEPI 1.00591.04991.0141.01931.00190.98210.98770.98930.9870.9792
SGAI 0.91180.95970.96891.02911.02540.98950.97250.92060.92250.9458
LVGI 0.95990.99751.01511.041.05091.01741.01470.99990.97250.9704
TATA -0.087-0.0841-0.0745-0.136-0.1639-0.1628-0.1551-0.1761-0.1763-0.1727
M-score -2.88-2.78-2.71-3.02-3.18-3.24-3.20-3.32-3.30-3.29
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK