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MGM Resorts International earnings quality score

How much of the reported profit is backed by cash, and how many markers of managed earnings the filings show

Score71 / 100 · grade B · rank 294 of 1027

MGM Resorts International (MGM) scores 71 of 100 for earnings quality, grade B: rank 294 of 1027 companies and 51 of 141 in consumer-disc. It loses the most points on accruals of -5.6% of assets, lower than 62% of companies (profit backed by cash), profit far steadier than cash flow (smoothness 0.29), Dechow F-score 1.39 (above normal). It earns full or near-full marks for adjusted earnings 3% below GAAP.

What earned and lost points

ComponentWhat the filings showPointsOf
Accrualsaccruals of -5.6% of assets, lower than 62% of companies (profit backed by cash)1727
Dechow F-scoreDechow F-score 1.39 (above normal)1520
Montier C-scoreMontier C-score 1 of 5 checks failed1620
Discretionary accrualsdiscretionary accruals of +1.4% of assets (modified Jones), smaller than most1013
Non-GAAP gapadjusted earnings 3% below GAAP1213
Earnings smoothnessprofit far steadier than cash flow (smoothness 0.29)17
MGM: share of the available points, by componentMGM: share of the available points, by componentAccruals63%Discretionary accruals75%Dechow F-score74%Montier C-score80%Non-GAAP gap92%Earnings smoothness18%

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.