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Block Beneish M-Score

: -1.21 (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.

Warning Sign:

Beneish M-Score -1.21 higher than -1.78, which implies that the company might have manipulated its financial results.

The historical rank and industry rank for Block's Beneish M-Score or its related term are showing as below:

SQ' s Beneish M-Score Range Over the Past 10 Years
Min: -3.45   Med: -2.03   Max: -0.62
Current: -1.21

During the past 10 years, the highest Beneish M-Score of Block was -0.62. The lowest was -3.45. And the median was -2.03.


Block Beneish M-Score Historical Data

The historical data trend for Block'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.

* Premium members only.

Block Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Beneish M-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.16 -2.59 -2.35 -1.57 -2.03

Block Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
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 -1.06 -1.40 -2.03 -0.62 -1.21

Competitive Comparison

For the Software - Infrastructure subindustry, Block'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.

   

Block Beneish M-Score Distribution

For the Software industry and Technology sector, Block's Beneish M-Score distribution charts can be found below:

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



Block 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 Block 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 * 1.5681+0.528 * 0.7453+0.404 * 3.5654+0.892 * 1.0224+0.115 * 0.5102
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.5294+4.679 * -0.0414-0.327 * 0.5005
=-1.21

* 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 (Jun22) TTM:Last Year (Jun21) TTM:
Total Receivables was $3,663 Mil.
Revenue was 4404.499 + 3960.645 + 4078.534 + 3844.727 = $16,288 Mil.
Gross Profit was 1469.648 + 1294.96 + 1182.043 + 1133.215 = $5,080 Mil.
Total Current Assets was $12,526 Mil.
Total Assets was $28,885 Mil.
Property, Plant and Equipment(Net PPE) was $754 Mil.
Depreciation, Depletion and Amortization(DDA) was $238 Mil.
Selling, General, & Admin. Expense(SGA) was $3,331 Mil.
Total Current Liabilities was $6,961 Mil.
Long-Term Debt & Capital Lease Obligation was $4,437 Mil.
Net Income was -208.014 + -204.199 + -76.829 + 0.084 = $-489 Mil.
Non Operating Income was -17.195 + 33.472 + -6.775 + -18.011 = $-9 Mil.
Cash Flow from Operations was -114.626 + 229.423 + 175.054 + 426.622 = $716 Mil.
Total Receivables was $2,285 Mil.
Revenue was 4680.672 + 5057.27 + 3158.97 + 3033.874 = $15,931 Mil.
Gross Profit was 1141.064 + 963.501 + 803.69 + 794.455 = $3,703 Mil.
Total Current Assets was $11,000 Mil.
Total Assets was $13,816 Mil.
Property, Plant and Equipment(Net PPE) was $722 Mil.
Depreciation, Depletion and Amortization(DDA) was $101 Mil.
Selling, General, & Admin. Expense(SGA) was $2,130 Mil.
Total Current Liabilities was $5,647 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 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)
=(3662.853 / 16288.405) / (2284.569 / 15930.786)
=0.22487487 / 0.14340592
=1.5681

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)
=(3702.71 / 15930.786) / (5079.866 / 16288.405)
=0.23242482 / 0.31187007
=0.7453

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 - (12526.335 + 754.459) / 28885.16) / (1 - (11000.235 + 722.16) / 13815.688)
=0.54022086 / 0.15151565
=3.5654

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
=16288.405 / 15930.786
=1.0224

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))
=(100.69 / (100.69 + 722.16)) / (238.057 / (238.057 + 754.459))
=0.12236738 / 0.23985205
=0.5102

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)
=(3331.41 / 16288.405) / (2130.473 / 15930.786)
=0.20452647 / 0.13373308
=1.5294

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)
=((4437.432 + 6960.986) / 28885.16) / ((5245.848 + 5646.77) / 13815.688)
=0.39461156 / 0.78842386
=0.5005

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
=(-488.958 - -8.509 - 716.473) / 28885.16
=-0.0414

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.

Block has a M-score of -1.21 signals that the company is likely to be a manipulator.


Block Business Description

Block logo
Address
1455 Market Street, Suite 600, San Francisco, CA, USA, 94103
Founded in 2009, Block provides payment acquiring services to merchants, along with related services. The company also launched Cash App, a person-to-person payment network. Block has operations in Canada, Japan, Australia, and the United Kingdom; about 5% of revenue is generated outside the U.S.
Executives
Rothstein Sharon director C/O YELP INC. 350 MISSION STREET, 10TH FLOOR SAN FRANCISCO CA 94105
Carter Shawn Corey director C/O S. CARTER ENTERPRISES, LLC 1411 BROADWAY NEW YORK NY 10018
Walker Darren director PEPSICO, INC., 700 ANDERSON HILL ROAD PURCHASE NY 10577
Grassadonia Brian officer: Cash App Lead 1455 MARKET STREET SUITE 600 SAN FRANCISCO CA 94103
Meeker Mary G director 2750 SAND HILL ROAD MENLO PARK CA 94025
Brooks Amy director 1455 MARKET STREET, SUITE 600 SAN FRANCISCO CA 94103
Ahuja Amrita officer: Chief Financial Officer 1455 MARKET STREET SUITE 600 SAN FRANCISCO CA 94103
Murphy Timothy Hugh officer: Interim CFO & Treasurer C/O SQUARE, INC. 1455 MARKET STREET, SUITE 600 SAN FRANCISCO CA 94103
Daswani Mohit officer: Interim CFO & Treasurer C/O SQUARE, INC. 1455 MARKET STREET, SUITE 600 SAN FRANCISCO CA 94103
Whiteley Sivan officer: Gen. Counsel & Corp. Secretary 1455 MARKET STREET SUITE 600 SAN FRANCISCO CA 94103
Patterson Anna director C/O SQUARE, INC. 1455 MARKET STREET, SUITE 600 SAN FRANCISCO CA 94103
Rao Naveen G director C/O SQUARE, INC. 1455 MARKET STREET, SUITE 600 SAN FRANCISCO CA 94103
Garutti Randall J director C/O SHAKE SHACK INC. 24 UNION SQUARE EAST, 5TH FLOOR NEW YORK NY 10003
Reses Jacqueline D officer: Capital Lead & People Lead C/O SQUARE, INC. 1455 MARKET STREET #600 SAN FRANCISCO CA 94103
Smith Hillary B officer: Gen. Counsel & Corp. Secretary C/O YEXT, INC 61 NINTH AVENUE NEW YORK NY 10011

Block Headlines

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