Rackspace Hosting Beneish M-Score Historical Data
The historical data trend for Rackspace Hosting'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.
Rackspace Hosting Beneish M-Score Chart
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Rackspace Hosting Annual Data
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Trend |
Dec06 |
Dec07 |
Dec08 |
Dec09 |
Dec10 |
Dec11 |
Dec12 |
Dec13 |
Dec14 |
Dec15 |
| Beneish M-Score |
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-3.20 |
-3.27 |
-3.20 |
-3.65 |
-3.77 |
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Rackspace Hosting Quarterly Data
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Dec11 |
Mar12 |
Jun12 |
Sep12 |
Dec12 |
Mar13 |
Jun13 |
Sep13 |
Dec13 |
Mar14 |
Jun14 |
Sep14 |
Dec14 |
Mar15 |
Jun15 |
Sep15 |
Dec15 |
Mar16 |
Jun16 |
Sep16 |
| Beneish M-Score |
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-3.48 |
-3.77 |
-3.76 |
-3.83 |
-3.86 |
Competitive Comparison of Rackspace Hosting's Beneish M-Score
For the Information Technology Services subindustry, Rackspace Hosting'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.
Rackspace Hosting's Beneish M-Score Distribution in the Software Industry
For the Software industry and Technology sector, Rackspace Hosting's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where Rackspace Hosting's Beneish M-Score falls into.
Rackspace Hosting 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 Rackspace Hosting 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 * 0.8899 | + | 0.528 * 1.0133 | + | 0.404 * 0.858 | + | 0.892 * 1.0665 | + | 0.115 * 0.8805 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 0.9614 | + | 4.679 * -0.253699 | - | 0.327 * 1.2923 |
| = | -3.86 |
* 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 (Sep16) TTM: | Last Year (Sep15) TTM: |
Total Receivables was $166 Mil.
Revenue was 516.2 + 523.6 + 518.1 + 522.8 = $2,081 Mil.
Gross Profit was 332.3 + 352.1 + 337.7 + 342.1 = $1,364 Mil.
Total Current Assets was $864 Mil.
Total Assets was $2,048 Mil.
Property, Plant and Equipment(Net PPE) was $1,032 Mil.
Depreciation, Depletion and Amortization(DDA) was $414 Mil.
Selling, General, & Admin. Expense(SGA) was $603 Mil.
Total Current Liabilities was $225 Mil.
Long-Term Debt & Capital Lease Obligation was $644 Mil.
Net Income was 38.6 + 35.8 + 48.8 + 31.1 = $154 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 148.8 + 164.9 + 156.2 + 204 = $674 Mil.
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Total Receivables was $175 Mil.
Revenue was 508.9 + 489.4 + 480.2 + 472.422 = $1,951 Mil.
Gross Profit was 336.2 + 324 + 317.4 + 318.51 = $1,296 Mil.
Total Current Assets was $441 Mil.
Total Assets was $1,754 Mil.
Property, Plant and Equipment(Net PPE) was $1,161 Mil.
Depreciation, Depletion and Amortization(DDA) was $391 Mil.
Selling, General, & Admin. Expense(SGA) was $588 Mil.
Total Current Liabilities was $410 Mil.
Long-Term Debt & Capital Lease Obligation was $166 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) |
| = | (166 / 2080.7) | / | (174.9 / 1950.922) |
| = | 0.079781 | / | 0.08965 |
| | = | 0.8899 |
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) |
| = | (1296.11 / 1950.922) | / | (1364.2 / 2080.7) |
| = | 0.664358 | / | 0.655645 |
| | = | 1.0133 |
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 - (864.3 + 1031.7) / 2048.1) | / | (1 - (440.7 + 1161.3) / 1753.8) |
| = | 0.074264 | / | 0.086555 |
| | = | 0.858 |
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 |
| = | 2080.7 | / | 1950.922 |
| | = | 1.0665 |
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)) |
| = | (391.113 / (391.113 + 1161.3)) | / | (413.5 / (413.5 + 1031.7)) |
| = | 0.251939 | / | 0.28612 |
| | = | 0.8805 |
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) |
| = | (603.3 / 2080.7) | / | (588.407 / 1950.922) |
| = | 0.28995 | / | 0.301605 |
| | = | 0.9614 |
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) |
| = | ((644.3 + 224.7) / 2048.1) | / | ((165.9 + 409.9) / 1753.8) |
| = | 0.424296 | / | 0.328316 |
| | = | 1.2923 |
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 |
| = | (154.3 - 0 | - | 673.9) | / | 2048.1 |
| | = | -0.253699 |
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.
Rackspace Hosting has a M-score of -3.86 suggests that the company is unlikely to be a manipulator.
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