Alphabet (XTER:ABEA) Beneish M-Score : -2.44 (As of Oct. 08, 2024)

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What is Alphabet 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 -2.44 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

XTER:ABEA' s Beneish M-Score Range Over the Past 10 Years
Min: -2.9 Med: -2.72 Max: -2.41
Current: -2.44

During the past 13 years, the highest Beneish M-Score of Alphabet was -2.41. The lowest was -2.90. And the median was -2.72.

Alphabet Beneish M-Score Historical Data

The historical data trend for Alphabet'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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Alphabet Beneish M-Score Chart

Alphabet Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.73

-2.79

-2.50

-2.72

-2.58

Alphabet Quarterly Data
	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24
Beneish M-Score	Get a 7-Day Free Trial															-2.78	-2.76	-2.58	-2.52	-2.44

Competitive Comparison of Alphabet's Beneish M-Score

For the Internet Content & Information subindustry, Alphabet'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.

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

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

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

Alphabet 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 Alphabet 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 * 1.1079

0.528 * 0.9663

0.404 * 1.0344

0.892 * 1.1024

0.115 * 1.0418

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.8778

4.679 * -0.040993

0.327 * 0.912

-2.43

This Year (Jun24) TTM:

Last Year (Jun23) TTM:

Total Receivables was €43,744 Mil.
Revenue was 78725.318 + 74095.88 + 79146.27 + 71861.341 = €303,829 Mil.
Gross Profit was 45739.315 + 43080.84 + 44689.995 + 40725.768 = €174,236 Mil.
Total Current Assets was €150,493 Mil.
Total Assets was €385,321 Mil.
Property, Plant and Equipment(Net PPE) was €153,063 Mil.
Depreciation, Depletion and Amortization(DDA) was €12,632 Mil.
Selling, General, & Admin. Expense(SGA) was €39,970 Mil.
Total Current Liabilities was €72,381 Mil.
Long-Term Debt & Capital Lease Obligation was €23,175 Mil.
Net Income was 21942.051 + 21769.04 + 18969.979 + 18448.593 = €81,130 Mil.
Non Operating Income was -833.313 + 1725.92 + -298.942 + -1026.952 = €-433 Mil.
Cash Flow from Operations was 24748.56 + 26540.16 + 17345.055 + 28724.672 = €97,358 Mil.

Total Receivables was €35,816 Mil.
Revenue was 68859.492 + 65181.058 + 71789.312 + 69782.92 = €275,613 Mil.
Gross Profit was 39401.024 + 36589.45 + 38426.464 + 38313.34 = €152,730 Mil.
Total Current Assets was €155,791 Mil.
Total Assets was €353,550 Mil.
Property, Plant and Equipment(Net PPE) was €125,230 Mil.
Depreciation, Depletion and Amortization(DDA) was €10,804 Mil.
Selling, General, & Admin. Expense(SGA) was €41,307 Mil.
Total Current Liabilities was €71,725 Mil.
Long-Term Debt & Capital Lease Obligation was €24,414 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)
	=	(43743.823 / 303828.809)	/	(35816.092 / 275612.782)
	=	0.143975	/	0.129951
	=	1.1079

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)
	=	(152730.278 / 275612.782)	/	(174235.918 / 303828.809)
	=	0.554148	/	0.573467
	=	0.9663

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 - (150493.355 + 153062.969) / 385321.33)	/	(1 - (155791.324 + 125229.871) / 353549.612)
	=	0.2122	/	0.205144
	=	1.0344

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
	=	303828.809	/	275612.782
	=	1.1024

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))
	=	(10804.214 / (10804.214 + 125229.871))	/	(12631.751 / (12631.751 + 153062.969))
	=	0.079423	/	0.076235
	=	1.0418

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)
	=	(39970.246 / 303828.809)	/	(41307.19 / 275612.782)
	=	0.131555	/	0.149874
	=	0.8778

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)
	=	((23174.834 + 72381.177) / 385321.33)	/	((24414.273 + 71725.407) / 353549.612)
	=	0.24799	/	0.271927
	=	0.912

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
	=	(81129.663 - -433.287	-	97358.447)	/	385321.33
	=	-0.040993

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.

Alphabet has a M-score of -2.43 suggests that the company is unlikely to be a manipulator.

Alphabet Beneish M-Score Related Terms

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Alphabet Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Interactive Media » Alphabet Inc (XTER:ABEA) » Definitions » Beneish M-Score

Comparable Companies

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GOOGL:USA GOOG:USA GOOG:Peru GOOGL:Peru GOOGL:Mexico GOOG:Mexico GOOG_KZ:Kazakhstan 1GOOG:Italy 1GOOGL:Italy ABEAd:UK ABECd:UK GOOGL:Chile GOOG:Canada GOGL35:Brazil GOGL34:Brazil ABEA:Bulgaria GOOC:Austria GOOA:Austria GOOGL:Argentina

Address

1600 Amphitheatre Parkway, Mountain View, CA, USA, 94043

Website

https://www.abc.xyz

Alphabet is a holding company that wholly owns internet giant Google. The California-based company derives slightly less than 90% of its revenue from Google services, the vast majority of which is advertising sales. Alongside online ads, Google services houses sales stemming from Google's subscription services (YouTube TV, YouTube Music among others), platforms (sales and in-app purchases on Play Store), and devices (Chromebooks, Pixel smartphones, and smart home products such as Chromecast). Google's cloud computing platform, or GCP, accounts for roughly 10% of Alphabet's revenue with the firm's investments in up-and-coming technologies such as self-driving cars (Waymo), health (Verily), and internet access (Google Fiber) making up the rest.

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