Paradox Interactive AB (OSTO:PDX) Beneish M-Score : -2.73 (As of May. 23, 2024)

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What is Paradox Interactive AB Beneish M-Score?

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 -2.73 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

OSTO:PDX' s Beneish M-Score Range Over the Past 10 Years
Min: -3.88 Med: -2.98 Max: -2.01
Current: -2.73

During the past 10 years, the highest Beneish M-Score of Paradox Interactive AB was -2.01. The lowest was -3.88. And the median was -2.98.

Paradox Interactive AB Beneish M-Score Historical Data

The historical data trend for Paradox Interactive AB'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.

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Paradox Interactive AB Beneish M-Score Chart

Paradox Interactive AB Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-3.25

-3.52

-3.24

-2.55

-2.85

Paradox Interactive AB Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
Beneish M-Score	Get a 7-Day Free Trial															-2.84	-2.85	-2.68	-2.85	-2.73

Competitive Comparison of Paradox Interactive AB's Beneish M-Score

For the Electronic Gaming & Multimedia subindustry, Paradox Interactive AB'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.

Paradox Interactive AB's Beneish M-Score Distribution in the Interactive Media Industry

For the Interactive Media industry and Communication Services sector, Paradox Interactive AB's Beneish M-Score distribution charts can be found below:

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

Paradox Interactive AB 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 Paradox Interactive AB for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 1.4673

0.528 * 1.3337

0.404 * 0.7842

0.892 * 1.3343

0.115 * 0.864

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.1203

4.679 * -0.228385

0.327 * 0.886

-2.73

This Year (Mar24) TTM:

Last Year (Mar23) TTM:

Total Receivables was kr591 Mil.
Revenue was 482.099 + 995.554 + 426.442 + 737.334 = kr2,641 Mil.
Gross Profit was 214.029 + 283.572 + 171.934 + 399.575 = kr1,069 Mil.
Total Current Assets was kr1,780 Mil.
Total Assets was kr3,548 Mil.
Property, Plant and Equipment(Net PPE) was kr110 Mil.
Depreciation, Depletion and Amortization(DDA) was kr982 Mil.
Selling, General, & Admin. Expense(SGA) was kr398 Mil.
Total Current Liabilities was kr583 Mil.
Long-Term Debt & Capital Lease Obligation was kr63 Mil.
Net Income was 126.864 + 98.269 + 69.294 + 239.351 = kr534 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = kr0 Mil.
Cash Flow from Operations was 136.91 + 525.516 + 260.14 + 421.562 = kr1,344 Mil.

Total Receivables was kr302 Mil.
Revenue was 482.777 + 580.01 + 457.994 + 458.806 = kr1,980 Mil.
Gross Profit was 219.706 + 326.779 + 260.53 + 261.577 = kr1,069 Mil.
Total Current Assets was kr1,152 Mil.
Total Assets was kr3,214 Mil.
Property, Plant and Equipment(Net PPE) was kr147 Mil.
Depreciation, Depletion and Amortization(DDA) was kr513 Mil.
Selling, General, & Admin. Expense(SGA) was kr266 Mil.
Total Current Liabilities was kr563 Mil.
Long-Term Debt & Capital Lease Obligation was kr98 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)
	=	(591.428 / 2641.429)	/	(302.07 / 1979.587)
	=	0.223905	/	0.152592
	=	1.4673

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)
	=	(1068.592 / 1979.587)	/	(1069.11 / 2641.429)
	=	0.539806	/	0.404747
	=	1.3337

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 - (1780.462 + 109.613) / 3548.176)	/	(1 - (1151.731 + 147.098) / 3214.451)
	=	0.467311	/	0.595941
	=	0.7842

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
	=	2641.429	/	1979.587
	=	1.3343

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))
	=	(513.216 / (513.216 + 147.098))	/	(981.503 / (981.503 + 109.613))
	=	0.77723	/	0.89954
	=	0.864

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)
	=	(397.818 / 2641.429)	/	(266.129 / 1979.587)
	=	0.150607	/	0.134437
	=	1.1203

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)
	=	((63.341 + 583.273) / 3548.176)	/	((97.794 + 563.395) / 3214.451)
	=	0.182238	/	0.205693
	=	0.886

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
	=	(533.778 - 0	-	1344.128)	/	3548.176
	=	-0.228385

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.

Paradox Interactive AB has a M-score of -2.73 suggests that the company is unlikely to be a manipulator.

Paradox Interactive AB Beneish M-Score Related Terms

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Paradox Interactive AB (OSTO:PDX) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Interactive Media » Paradox Interactive AB (OSTO:PDX) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

PRXXF:USA 0GDU:UK ETA:Germany

Address

Magnus Ladulasgatan 4, Stockholm, SWE, SE-118 66

Website

https://www.paradoxinteractive.com

Paradox Interactive AB is a Swedish company. It is engaged in the development and publishing of PC-based games. The company's product portfolio includes franchise brands such as g Stellaris, Europa Universalis, Hearts of Iron, Crusader Kings, Cities, Skylines, Tyranny and Magicka. Paradox is also involved in the publishing and internal development of games and licensing of White Wolf's brands. The company distributes its games through the digital platform Steam as well as on Apple, Google Play, and Sony stores. It operates its business across the world. The majority of the company's revenue comes from the United States.