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Marcus & Millichap Inc (NYSE:MMI)
Beneish M-Score
-2.83 (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.

Marcus & Millichap Inc has a M-score of -2.83 suggests that the company is not a manipulator.

MMI' s Beneish M-Score Range Over the Past 10 Years
Min: -2.83   Max: -1.92
Current: -2.83

-2.83
-1.92

During the past 7 years, the highest Beneish M-Score of Marcus & Millichap Inc was -1.92. The lowest was -2.83. And the median was -2.27.


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 Marcus & Millichap 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 * 0.5211+0.528 * 1.0191+0.404 * 0.9905+0.892 * 0.9994+0.115 * 0.9895
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0565+4.679 * 0.0074-0.327 * 0.8197
=-2.83

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Mar17) TTM:Last Year (Mar16) TTM:
Accounts Receivable was $3.3 Mil.
Revenue was 153.212 + 189.157 + 180.634 + 183.387 = $706.4 Mil.
Gross Profit was 63.565 + 67.52 + 66.782 + 70.261 = $268.1 Mil.
Total Current Assets was $204.9 Mil.
Total Assets was $363.5 Mil.
Property, Plant and Equipment(Net PPE) was $16.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.7 Mil.
Selling, General & Admin. Expense(SGA) was $162.8 Mil.
Total Current Liabilities was $40.9 Mil.
Long-Term Debt was $8.7 Mil.
Net Income was 12 + 17.174 + 15.144 + 17.524 = $61.8 Mil.
Non Operating Income was 0.836 + 0.567 + 0.719 + 0.618 = $2.7 Mil.
Cash Flow from Operations was -37.086 + 32.968 + 29.258 + 31.283 = $56.4 Mil.
Accounts Receivable was $6.4 Mil.
Revenue was 164.272 + 203.156 + 165.876 + 173.482 = $706.8 Mil.
Gross Profit was 68.119 + 73.492 + 63.866 + 67.925 = $273.4 Mil.
Total Current Assets was $167.5 Mil.
Total Assets was $297.6 Mil.
Property, Plant and Equipment(Net PPE) was $12.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $3.5 Mil.
Selling, General & Admin. Expense(SGA) was $154.1 Mil.
Total Current Liabilities was $39.9 Mil.
Long-Term Debt was $9.7 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)
=(3.309 / 706.39) / (6.354 / 706.786)
=0.00468438 / 0.00898999
=0.5211

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)
=(273.402 / 706.786) / (268.128 / 706.39)
=0.3868243 / 0.37957502
=1.0191

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 - (204.945 + 16.267) / 363.487) / (1 - (167.542 + 12.446) / 297.582)
=0.39141702 / 0.39516503
=0.9905

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
=706.39 / 706.786
=0.9994

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))
=(3.531 / (3.531 + 12.446)) / (4.678 / (4.678 + 16.267))
=0.22100519 / 0.22334686
=0.9895

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)
=(162.759 / 706.39) / (154.136 / 706.786)
=0.23040955 / 0.21808015
=1.0565

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)
=((8.686 + 40.916) / 363.487) / ((9.671 + 39.867) / 297.582)
=0.13646155 / 0.1664684
=0.8197

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
=(61.842 - 2.74 - 56.423) / 363.487
=0.0074

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.

Marcus & Millichap Inc has a M-score of -2.83 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 local exchange's currency.

Marcus & Millichap Inc Annual Data

Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.80270.81341.382
GMI 1.01221.00671.0144
AQI 1.12331.35271.0315
SGI 1.31271.20421.0412
DEPI 0.89161.32471.0499
SGAI 0.69620.91351.052
LVGI 0.81640.79140.8362
TATA -0.0939-0.0193-0.0304
M-score -2.67-2.29-2.16

Marcus & Millichap Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 0.80270.69790.90860.81341.1830.85951.14421.3820.5211
GMI 1.01221.0111.00911.00671.0111.00811.01591.01441.0191
AQI 1.12331.48351.66611.35271.42651.10881.40951.03150.9905
SGI 1.31271.26171.19951.20421.16991.1141.1111.04120.9994
DEPI 0.89161.00751.16811.32471.29161.31311.19221.04990.9895
SGAI 0.69620.71070.74070.91350.96350.99081.01451.0521.0565
LVGI 0.81640.87180.77450.79140.74610.71870.80740.83620.8197
TATA -0.0939-0.1018-0.0435-0.0193-0.01390.0126-0.0267-0.03040.0074
M-score -2.67-2.71-2.18-2.29-1.92-2.27-2.12-2.16-2.83
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