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Butterfly Network earnings quality score
How much of the reported profit is backed by cash, and how many markers of managed earnings the filings show
Score63 / 100 · grade C · rank 629 of 1027
Butterfly Network (BFLY) scores 63 of 100 for earnings quality, grade C: rank 629 of 1027 companies and 72 of 126 in health. It loses the most points on Montier C-score 4 of 6 checks failed, adjusted earnings 210% below GAAP, discretionary accruals of -18.1% of assets (modified Jones), larger than most. It earns full or near-full marks for accruals of -23.3% of assets, lower than 98% of companies (profit backed by cash), Beneish M-score -3.31: clean (below −2.22), Dechow F-score 0.65 (normal). Revenue grew 39% in the year: fast growth raises accruals, the Beneish and Dechow scores and the C-score by construction, so a growing company scores lower than a steady one with the same accounting.
What earned and lost points
| Component | What the filings show | Points | Of |
|---|---|---|---|
| Accruals | accruals of -23.3% of assets, lower than 98% of companies (profit backed by cash) | 20 | 20 |
| Beneish M-score | Beneish M-score -3.31: clean (below −2.22) | 15 | 15 |
| Dechow F-score | Dechow F-score 0.65 (normal) | 15 | 15 |
| Montier C-score | Montier C-score 4 of 6 checks failed | 5 | 15 |
| Discretionary accruals | discretionary accruals of -18.1% of assets (modified Jones), larger than most | 0 | 10 |
| Piotroski F-score | Piotroski F-score 3 of 9 | 3 | 10 |
| Non-GAAP gap | adjusted earnings 210% below GAAP | 0 | 10 |
| Earnings smoothness | profit about as variable as cash flow (smoothness 0.83) | 5 | 5 |
How the score is built
Eight published measures, each scored against the whole universe or on its own scale and weighted: accruals 20, discretionary accruals 10, Beneish M 15, Dechow F 15, Montier C 15, Piotroski F 10, the non-GAAP gap 10, smoothness 5. A measure that cannot be computed (Beneish for a bank, say) drops out and the rest is rescaled, so every company is scored on what applies to it.
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Computed from the companies’ own XBRL filings (latest fiscal year) by published formulas; a statistical screen, not an audit or an accusation. A low score means the reported profit shows more of the markers of managed or low-quality earnings than its peers. Not investment advice.