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Darden Restaurants Beneish M-Score

: -2.55 (As of Today)
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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 -2.55 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

NYSE:DRI' s Beneish M-Score Range Over the Past 10 Years
Min: -4.02   Med: -2.8   Max: -1.24
Current: -2.55

-4.02
-1.24

During the past 13 years, the highest Beneish M-Score of Darden Restaurants was -1.24. The lowest was -4.02. And the median was -2.80.


Darden Restaurants Beneish M-Score Historical Data

* 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.

* Premium members only.

Darden Restaurants Annual Data
May11 May12 May13 May14 May15 May16 May17 May18 May19 May20
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.80 -2.81 -2.86 -2.92 -3.18

Darden Restaurants Quarterly Data
May16 Aug16 Nov16 Feb17 May17 Aug17 Nov17 Feb18 May18 Aug18 Nov18 Feb19 May19 Aug19 Nov19 Feb20 May20 Aug20 Nov20 Feb21
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -3.20 -3.18 -2.62 -2.76 -2.55

Competitive Comparison
* 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.


Darden Restaurants Beneish M-Score Distribution

* The bar in red indicates where Darden Restaurants's Beneish M-Score falls into.



Darden Restaurants Beneish M-Score Calculation

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 Darden Restaurants 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 * 1.2176+0.528 * 1.3915+0.404 * 0.8584+0.892 * 0.7058+0.115 * 0.9587
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0228+4.679 * -0.0355-0.327 * 0.9598
=-2.55

* 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 (Feb21) TTM:Last Year (Feb20) TTM:
Accounts Receivable was $44 Mil.
Revenue was 1733 + 1656.5 + 1527.4 + 1270.1 = $6,187 Mil.
Gross Profit was 337.4 + 315.4 + 301.3 + 10.5 = $965 Mil.
Total Current Assets was $1,300 Mil.
Total Assets was $10,096 Mil.
Property, Plant and Equipment(Net PPE) was $6,656 Mil.
Depreciation, Depletion and Amortization(DDA) was $356 Mil.
Selling, General, & Admin. Expense(SGA) was $482 Mil.
Total Current Liabilities was $1,647 Mil.
Long-Term Debt & Capital Lease Obligation was $5,086 Mil.
Net Income was 128.7 + 96 + 36.1 + -480 = $-219 Mil.
Non Operating Income was -3.6 + -0.4 + -7.5 + -388.3 = $-400 Mil.
Cash Flow from Operations was 318.9 + 219.7 + 208.9 + -208.6 = $539 Mil.
Accounts Receivable was $51 Mil.
Revenue was 2346.5 + 2056.4 + 2133.9 + 2229.1 = $8,766 Mil.
Gross Profit was 538 + 405.5 + 454.4 + 503.8 = $1,902 Mil.
Total Current Assets was $686 Mil.
Total Assets was $9,973 Mil.
Property, Plant and Equipment(Net PPE) was $6,825 Mil.
Depreciation, Depletion and Amortization(DDA) was $349 Mil.
Selling, General, & Admin. Expense(SGA) was $668 Mil.
Total Current Liabilities was $1,683 Mil.
Long-Term Debt & Capital Lease Obligation was $5,246 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Accounts Receivable 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)
=(44 / 6187) / (51.2 / 8765.9)
=0.00711169 / 0.00584081
=1.2176

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)
=(1901.7 / 8765.9) / (964.6 / 6187)
=0.21694293 / 0.15590755
=1.3915

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 - (1300.4 + 6656.2) / 10096.1) / (1 - (686 + 6825.3) / 9973.3)
=0.21191351 / 0.24685911
=0.8584

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
=6187 / 8765.9
=0.7058

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))
=(349.4 / (349.4 + 6825.3)) / (356.2 / (356.2 + 6656.2))
=0.0486989 / 0.05079573
=0.9587

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)
=(482.1 / 6187) / (667.8 / 8765.9)
=0.07792145 / 0.07618157
=1.0228

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)
=((5086 + 1646.5) / 10096.1) / ((5245.9 + 1683.1) / 9973.3)
=0.66684165 / 0.694755
=0.9598

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
=(-219.2 - -399.8 - 538.9) / 10096.1
=-0.0355

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.

Darden Restaurants has a M-score of -2.55 suggests that the company is unlikely to be a manipulator.


Darden Restaurants Beneish M-Score Headlines

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