RingCentral Beneish M-Score Historical Data
The historical data trend for RingCentral'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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RingCentral Annual Data
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Trend |
Dec14 |
Dec15 |
Dec16 |
Dec17 |
Dec18 |
Dec19 |
Dec20 |
Dec21 |
Dec22 |
Dec23 |
| Beneish M-Score |
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-1.18 |
-2.75 |
-2.99 |
-3.71 |
-3.93 |
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RingCentral Quarterly Data
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Mar19 |
Jun19 |
Sep19 |
Dec19 |
Mar20 |
Jun20 |
Sep20 |
Dec20 |
Mar21 |
Jun21 |
Sep21 |
Dec21 |
Mar22 |
Jun22 |
Sep22 |
Dec22 |
Mar23 |
Jun23 |
Sep23 |
Dec23 |
| Beneish M-Score |
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-3.71 |
-3.77 |
-3.74 |
-3.62 |
-3.93 |
Competitive Comparison
For the Software - Application subindustry, RingCentral'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.
RingCentral Beneish M-Score Distribution
For the Software industry and Technology sector, RingCentral's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where RingCentral's Beneish M-Score falls into.
RingCentral 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 RingCentral 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 * 1.0568 | + | 0.528 * 0.9697 | + | 0.404 * 0.8766 | + | 0.892 * 1.1077 | + | 0.115 * 1.0403 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 0.9369 | + | 4.679 * -0.330537 | - | 0.327 * 1.0086 |
| = | -3.93 |
* 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 (Dec23) TTM: | Last Year (Dec22) TTM: |
Total Receivables was $364 Mil.
Revenue was 571.271 + 558.164 + 539.305 + 533.689 = $2,202 Mil.
Gross Profit was 401.047 + 389.19 + 374.888 + 373.013 = $1,538 Mil.
Total Current Assets was $849 Mil.
Total Assets was $1,945 Mil.
Property, Plant and Equipment(Net PPE) was $227 Mil.
Depreciation, Depletion and Amortization(DDA) was $234 Mil.
Selling, General, & Admin. Expense(SGA) was $1,401 Mil.
Total Current Liabilities was $633 Mil.
Long-Term Debt & Capital Lease Obligation was $1,554 Mil.
Net Income was -47.243 + -42.116 + -21.482 + -54.399 = $-165 Mil.
Non Operating Income was 16.442 + 20.441 + 35.651 + 5.429 = $78 Mil.
Cash Flow from Operations was 113.844 + 86.594 + 90.691 + 108.533 = $400 Mil.
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Total Receivables was $311 Mil.
Revenue was 524.746 + 509.032 + 486.896 + 467.656 = $1,988 Mil.
Gross Profit was 364.153 + 341.558 + 328.706 + 312.182 = $1,347 Mil.
Total Current Assets was $796 Mil.
Total Assets was $2,074 Mil.
Property, Plant and Equipment(Net PPE) was $221 Mil.
Depreciation, Depletion and Amortization(DDA) was $247 Mil.
Selling, General, & Admin. Expense(SGA) was $1,350 Mil.
Total Current Liabilities was $653 Mil.
Long-Term Debt & Capital Lease Obligation was $1,659 Mil.
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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) |
| = | (364.438 / 2202.429) | / | (311.318 / 1988.33) |
| = | 0.165471 | / | 0.156573 |
| | = | 1.0568 |
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) |
| = | (1346.599 / 1988.33) | / | (1538.138 / 2202.429) |
| = | 0.677251 | / | 0.698383 |
| | = | 0.9697 |
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 - (848.649 + 227.379) / 1944.913) | / | (1 - (796.016 + 220.833) / 2073.662) |
| = | 0.446747 | / | 0.509636 |
| | = | 0.8766 |
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 |
| = | 2202.429 | / | 1988.33 |
| | = | 1.1077 |
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)) |
| = | (246.561 / (246.561 + 220.833)) | / | (233.94 / (233.94 + 227.379)) |
| = | 0.527523 | / | 0.507111 |
| | = | 1.0403 |
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) |
| = | (1401.098 / 2202.429) | / | (1350.129 / 1988.33) |
| = | 0.63616 | / | 0.679027 |
| | = | 0.9369 |
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) |
| = | ((1553.66 + 632.546) / 1944.913) | / | ((1658.593 + 652.559) / 2073.662) |
| = | 1.124064 | / | 1.114527 |
| | = | 1.0086 |
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 |
| = | (-165.24 - 77.963 | - | 399.662) | / | 1944.913 |
| | = | -0.330537 |
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.
RingCentral has a M-score of -3.93 suggests that the company is unlikely to be a manipulator.
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