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GuruFocus has detected 4 Warning Signs with American Public Education Inc $APEI.
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American Public Education Inc (NAS:APEI)
Beneish M-Score
-3.03 (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.

American Public Education Inc has a M-score of -3.03 suggests that the company is not a manipulator.

APEI' s Beneish M-Score Range Over the Past 10 Years
Min: -3.34   Max: 0.34
Current: -3.03

-3.34
0.34

During the past 13 years, the highest Beneish M-Score of American Public Education Inc was 0.34. The lowest was -3.34. And the median was -3.02.


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 American Public Education Inc 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 * 0.9191+0.528 * 1.0194+0.404 * 0.8849+0.892 * 0.955+0.115 * 0.9548
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9852+4.679 * -0.0993-0.327 * 0.7867
=-3.03

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $6.9 Mil.
Revenue was 78.625 + 73.803 + 76.745 + 83.966 = $313.1 Mil.
Gross Profit was 48.58 + 45.446 + 47.559 + 54.258 = $195.8 Mil.
Total Current Assets was $163.7 Mil.
Total Assets was $320.7 Mil.
Property, Plant and Equipment(Net PPE) was $97.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $19.4 Mil.
Selling, General & Admin. Expense(SGA) was $128.2 Mil.
Total Current Liabilities was $42.2 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 6.893 + 0.326 + 6.596 + 10.34 = $24.2 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.0 Mil.
Cash Flow from Operations was 13.326 + 13.901 + 8.735 + 20.052 = $56.0 Mil.
Accounts Receivable was $7.9 Mil.
Revenue was 85.912 + 76.291 + 80.263 + 85.444 = $327.9 Mil.
Gross Profit was 56.187 + 47.124 + 50.567 + 55.184 = $209.1 Mil.
Total Current Assets was $131.1 Mil.
Total Assets was $303.9 Mil.
Property, Plant and Equipment(Net PPE) was $109.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $20.5 Mil.
Selling, General & Admin. Expense(SGA) was $136.3 Mil.
Total Current Liabilities was $50.8 Mil.
Long-Term Debt was $0.0 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)
=(6.949 / 313.139) / (7.917 / 327.91)
=0.02219142 / 0.02414382
=0.9191

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)
=(209.062 / 327.91) / (195.843 / 313.139)
=0.63755909 / 0.62541874
=1.0194

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 - (163.719 + 97.687) / 320.712) / (1 - (131.111 + 109.281) / 303.896)
=0.1849198 / 0.20896623
=0.8849

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
=313.139 / 327.91
=0.955

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))
=(20.52 / (20.52 + 109.281)) / (19.384 / (19.384 + 97.687))
=0.15808815 / 0.16557474
=0.9548

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)
=(128.203 / 313.139) / (136.261 / 327.91)
=0.40941243 / 0.4155439
=0.9852

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)
=((0 + 42.175) / 320.712) / ((0 + 50.799) / 303.896)
=0.13150428 / 0.16715916
=0.7867

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
=(24.155 - 0 - 56.014) / 320.712
=-0.0993

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.

American Public Education Inc has a M-score of -3.03 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 local exchange's currency.

American Public Education Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.52080.8151.00690.89110.7040.91170.86870.60611.37860.9191
GMI 0.96190.96610.97580.98090.97740.97810.98611.01751.01391.0179
AQI 1.15460.95191.19140.55830.70768.12674.11080.841.05050.8849
SGI 1.72541.55071.39061.331.31391.20411.05091.06230.93680.955
DEPI 0.9890.9831.03591.28930.97831.14570.91520.95290.86020.9548
SGAI 0.9120.98230.97241.09581.06771.1011.0471.00061.00790.9818
LVGI 0.75011.00340.9111.05911.07560.81320.86180.81091.03210.7867
TATA -0.179-0.1722-0.1107-0.1213-0.1492-0.0446-0.064-0.0676-0.0816-0.0993
M-score -2.97-3.00-2.54-3.04-3.340.34-1.58-3.10-2.57-3.03

American Public Education Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 0.92050.60610.6670.67051.381.37860.98441.19380.68570.9191
GMI 1.02131.01751.01141.0111.01171.01391.01371.01141.00451.0194
AQI 3.37970.840.86880.85010.85441.05051.04371.00350.97640.8849
SGI 1.02741.06231.03811.00880.97550.93680.9410.9450.96140.955
DEPI 0.92030.95290.96360.97610.96820.86020.85950.85590.82190.9548
SGAI 1.0571.00061.00171.00580.99491.00790.98660.97410.97180.9852
LVGI 0.87740.81090.80760.90451.01651.03211.08320.960.76150.7867
TATA -0.0489-0.0676-0.0549-0.0859-0.0714-0.0816-0.115-0.0944-0.0959-0.0993
M-score -1.76-3.10-3.00-3.20-2.55-2.57-3.10-2.78-3.20-3.03
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