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The zones of discrimination for M-Score is as such:
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
Good Sign:
Beneish M-Score -3.01 no higher than -1.78, which implies that the company is unlikely to be a manipulator.
The historical rank and industry rank for Adobe's Beneish M-Score or its related term are showing as below:
During the past 13 years, the highest Beneish M-Score of Adobe was -2.43. The lowest was -3.01. And the median was -2.68.
The historical data trend for Adobe's Beneish M-Score can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Adobe Annual Data | |||||||||||||||||||||
Trend | Nov15 | Nov16 | Nov17 | Nov18 | Nov19 | Nov20 | Nov21 | Nov22 | Nov23 | Nov24 | |||||||||||
Beneish M-Score | Get a 7-Day Free Trial |
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-2.60 | -2.60 | -2.95 | -2.70 | -2.83 |
Adobe Quarterly Data | ||||||||||||||||||||
May20 | Aug20 | Nov20 | Feb21 | May21 | Aug21 | Nov21 | Feb22 | May22 | Aug22 | Nov22 | Feb23 | May23 | Aug23 | Nov23 | Feb24 | May24 | Aug24 | Nov24 | Feb25 | |
Beneish M-Score | Get a 7-Day Free Trial |
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-2.53 | -2.64 | -2.60 | -2.83 | -3.01 |
For the Software - Application subindustry, Adobe's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
For the Software industry and Technology sector, Adobe's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where Adobe's Beneish M-Score falls into.
The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Adobe 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 * 0.8677 | + | 0.528 * 0.988 | + | 0.404 * 0.9921 | + | 0.892 * 1.1054 | + | 0.115 * 0.9473 | |
- | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI | |||||||
- | 0.172 * 0.986 | + | 4.679 * -0.087598 | - | 0.327 * 1.2464 | |||||||
= | -3.01 |
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
This Year (Feb25) TTM: | Last Year (Feb24) TTM: |
Total Receivables was $1,973 Mil. Revenue was 5714 + 5606 + 5408 + 5309 = $22,037 Mil. Gross Profit was 5092 + 4990 + 4854 + 4711 = $19,647 Mil. Total Current Assets was $10,855 Mil. Total Assets was $29,955 Mil. Property, Plant and Equipment(Net PPE) was $2,159 Mil. Depreciation, Depletion and Amortization(DDA) was $862 Mil. Selling, General, & Admin. Expense(SGA) was $7,451 Mil. Total Current Liabilities was $9,163 Mil. Long-Term Debt & Capital Lease Obligation was $6,489 Mil. Net Income was 1811 + 1683 + 1684 + 1573 = $6,751 Mil. Non Operating Income was 81 + -257 + 101 + 86 = $11 Mil. Cash Flow from Operations was 2482 + 2921 + 2021 + 1940 = $9,364 Mil. |
Total Receivables was $2,057 Mil. Revenue was 5182 + 5048 + 4890 + 4816 = $19,936 Mil. Gross Profit was 4592 + 4414 + 4310 + 4244 = $17,560 Mil. Total Current Assets was $10,008 Mil. Total Assets was $28,751 Mil. Property, Plant and Equipment(Net PPE) was $2,354 Mil. Depreciation, Depletion and Amortization(DDA) was $872 Mil. Selling, General, & Admin. Expense(SGA) was $6,836 Mil. Total Current Liabilities was $9,537 Mil. Long-Term Debt & Capital Lease Obligation was $2,516 Mil. |
1. DSRI = Days Sales in Receivables Index
Measured as the ratio of Revenue in Total 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) |
= | (1973 / 22037) | / | (2057 / 19936) | |
= | 0.089531 | / | 0.10318 | |
= | 0.8677 |
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) | |
= | (17560 / 19936) | / | (19647 / 22037) | |
= | 0.880819 | / | 0.891546 | |
= | 0.988 |
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 Property, Plant and Equipment to Total Assets.
AQI | = | (1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) | / | (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1) |
= | (1 - (10855 + 2159) / 29955) | / | (1 - (10008 + 2354) / 28751) | |
= | 0.565548 | / | 0.570032 | |
= | 0.9921 |
4. SGI = Sales Growth Index
Ratio of Revenue 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 | |
= | 22037 | / | 19936 | |
= | 1.1054 |
5. DEPI = Depreciation Index
Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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)) |
= | (872 / (872 + 2354)) | / | (862 / (862 + 2159)) | |
= | 0.270304 | / | 0.285336 | |
= | 0.9473 |
Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.
6. SGAI = Sales, General and Administrative expenses Index
The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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) |
= | (7451 / 22037) | / | (6836 / 19936) | |
= | 0.338113 | / | 0.342897 | |
= | 0.986 |
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 in leverage
LVGI | = | ((LTD_t + CurrentLiabilities_t) / TotalAssets_t) | / | ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1) |
= | ((6489 + 9163) / 29955) | / | ((2516 + 9537) / 28751) | |
= | 0.522517 | / | 0.41922 | |
= | 1.2464 |
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 | |
= | (6751 - 11 | - | 9364) | / | 29955 | |
= | -0.087598 |
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
Adobe has a M-score of -3.01 suggests that the company is unlikely to be a manipulator.
Thank you for viewing the detailed overview of Adobe's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.
David A Ricks | director | LILLY CORPORATE CENTER, INDIANAPOLIS IN 46285 |
Scott Belsky | officer: EVP, Chief Product Officer | 345 PARK AVENUE, SAN JOSE CA 95110 |
Amy Banse | director | 345 PARK AVENUE, SAN JOSE CA 95110 |
Shantanu Narayen | director, officer: President and CEO | 345 PARK AVENUE, SAN JOSE CA 95110 |
Daniel Durn | officer: EVP and CFO | C/O APPLIED MATERIALS, INC., 3050 BOWERS AVENUE, P.O. BOX 58039, SANTA CLARA CA 95052-8039 |
Mark S. Garfield | officer: VP, CAO & Corp. Controller | 345 PARK AVENUE, SAN JOSE CA 95110-2704 |
Dana Rao | officer: EVP, Gen. Counsel & Secretary | 345 PARK AVE, SAN JOSE CA 95110 |
Anil Chakravarthy | officer: EVP & GM, Digital Experience | C/O INFORMATICA CORPORATION, 2100 SEAPORT BOULEVARD, REDWOOD CITY CA 94063 |
David Wadhwani | officer: SVP & GM, Digital Media | ADOBE INC., 345 PARK AVE, SAN JOSE CA 95110 |
Cristiano R Amon | director | 5775 MOREHOUSE DRIVE, SAN DIEGO CA 92121 |
John E Warnock | director, other: Co-Chairman of the Board | C/O ADOBE SYSTEMS INC, 345 PARK AVENUE P O BOX 2704, SAN JOSE CA 95110-2704 |
Ann Lewnes | officer: SVP, Chief Marketing Officer | 345 PARK AVENUE, SAN JOSE CA 95110 |
M. Brett Biggs | director | 702 SW 8TH STREET, BENTONVILLE AR 72716 |
Laura Desmond | director | 345 PARK AVENUE, SAN JOSE CA 95110 |
Spencer Adam Neumann | director | SIERRA INCOME CORPORATION, 375 PARK AVE., SUITE 3304, NEW YORK NY 10152 |
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