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Abercrombie & Fitch Co (NYSE:ANF)
Beneish M-Score
-2.83 (As of Today)

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Abercrombie & Fitch Co has a M-score of -2.83 suggests that the company is not a manipulator.

ANF' s Beneish M-Score Range Over the Past 10 Years
Min: -3.85   Max: 20.74
Current: -2.83

-3.85
20.74

During the past 13 years, the highest Beneish M-Score of Abercrombie & Fitch Co was 20.74. The lowest was -3.85. And the median was -2.70.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (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 Abercrombie & Fitch Co 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 * 1.1211+0.528 * 0.9867+0.404 * 1.0765+0.892 * 0.9724+0.115 * 0.955
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0052+4.679 * -0.0969-0.327 * 0.9998
=-2.83

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Jul16) TTM:Last Year (Jul15) TTM:
Accounts Receivable was $79 Mil.
Revenue was 783.16 + 685.483 + 1112.93 + 878.572 = $3,460 Mil.
Gross Profit was 477.107 + 425.721 + 676.345 + 559.787 = $2,139 Mil.
Total Current Assets was $1,097 Mil.
Total Assets was $2,332 Mil.
Property, Plant and Equipment(Net PPE) was $850 Mil.
Depreciation, Depletion and Amortization(DDA) was $205 Mil.
Selling, General & Admin. Expense(SGA) was $2,045 Mil.
Total Current Liabilities was $499 Mil.
Long-Term Debt was $336 Mil.
Net Income was -13.129 + -39.587 + 57.741 + 41.891 = $47 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 18.424 + -76.283 + 243.401 + 87.293 = $273 Mil.
Accounts Receivable was $72 Mil.
Revenue was 817.756 + 709.422 + 1119.544 + 911.453 = $3,558 Mil.
Gross Profit was 509.862 + 411.549 + 681.885 + 567.07 = $2,170 Mil.
Total Current Assets was $1,103 Mil.
Total Assets was $2,422 Mil.
Property, Plant and Equipment(Net PPE) was $947 Mil.
Depreciation, Depletion and Amortization(DDA) was $216 Mil.
Selling, General & Admin. Expense(SGA) was $2,092 Mil.
Total Current Liabilities was $529 Mil.
Long-Term Debt was $338 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in 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)
=(79.012 / 3460.145) / (72.477 / 3558.175)
=0.02283488 / 0.02036915
=1.1211

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)
=(2170.366 / 3558.175) / (2138.96 / 3460.145)
=0.60996606 / 0.61817063
=0.9867

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 plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (1096.671 + 850.114) / 2332.39) / (1 - (1103.142 + 947.053) / 2422.201)
=0.16532612 / 0.1535818
=1.0765

4. SGI = Sales Growth Index

Ratio of sales 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
=3460.145 / 3558.175
=0.9724

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation 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))
=(216.018 / (216.018 + 947.053)) / (205.254 / (205.254 + 850.114))
=0.18573071 / 0.19448571
=0.955

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses 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)
=(2044.526 / 3460.145) / (2091.596 / 3558.175)
=0.59087871 / 0.58782831
=1.0052

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$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((335.66 + 499.344) / 2332.39) / ((338.215 + 529.128) / 2422.201)
=0.35800359 / 0.35808052
=0.9998

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
=(46.916 - 0 - 272.835) / 2332.39
=-0.0969

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Abercrombie & Fitch Co has a M-score of -2.83 suggests that the company will not be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Abercrombie & Fitch Co Annual Data

Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16
DSRI 0.8671.1011.06252.03540.75510.91721.02780.74750.8561.1436
GMI 0.99870.9941.0011.04031.00611.04230.98220.99821.01241.0078
AQI 1.7471.49873.12080.91441.02180.93811.071.12611.06420.9929
SGI 1.19161.13010.92910.84061.18441.19871.08480.91270.90940.9398
DEPI 1.09180.92860.71990.86170.96881.02041.11310.85010.90730.9837
SGAI 0.99681.01061.11191.14940.94440.94621.00231.06670.99491.0211
LVGI 0.8270.93130.91260.95571.15371.14151.03991.03981.25781.0801
TATA -0.0712-0.1332-0.0767-0.1401-0.0801-0.071-0.1497-0.0424-0.104-0.1128
M-score -2.40-2.68-2.01-2.37-2.95-2.75-3.06-2.98-3.24-2.96

Abercrombie & Fitch Co Quarterly Data

Apr14Jul14Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16
DSRI 0.82780.89070.81980.8560.95481.08881.06251.14361.08331.1211
GMI 1.03371.04651.04521.01241.01371.00610.99641.00780.9810.9867
AQI 1.21021.1511.0611.06421.02071.01451.00590.99290.99511.0765
SGI 0.9260.91470.91540.90940.88550.87950.89850.93980.96250.9724
DEPI 0.88450.90090.95320.90730.9170.94470.95720.98370.98020.955
SGAI 1.04161.02290.98750.99491.01321.02911.04411.02111.00911.0052
LVGI 1.00731.05681.20521.25781.30231.25441.1711.08011.05630.9998
TATA -0.0938-0.1249-0.1404-0.104-0.1043-0.1311-0.1303-0.1128-0.1144-0.0969
M-score -3.06-3.19-3.40-3.24-3.21-3.20-3.19-2.96-3.01-2.83
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