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AutoZone Inc (NYSE:AZO)
Beneish M-Score
-2.47 (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.

AutoZone Inc has a M-score of -2.47 suggests that the company is not a manipulator.

AZO' s 10-Year Beneish M-Score Range
Min: -3.21   Max: 1.03
Current: -2.47

-3.21
1.03

During the past 13 years, the highest Beneish M-Score of AutoZone Inc was 1.03. The lowest was -3.21. And the median was -2.48.


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 AutoZone 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 * 1.0636+0.528 * 0.9943+0.404 * 1.0186+0.892 * 1.0447+0.115 * 0.9971
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0105+4.679 * -0.0208-0.327 * 0.9658
=-2.47

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

This Year (May15) TTM:Last Year (May14) TTM:
Accounts Receivable was $212 Mil.
Revenue was 2493.021 + 2143.651 + 2260.264 + 3049.696 = $9,947 Mil.
Gross Profit was 1302.789 + 1120.033 + 1176.661 + 1595.217 = $5,195 Mil.
Total Current Assets was $3,950 Mil.
Total Assets was $8,032 Mil.
Property, Plant and Equipment(Net PPE) was $3,426 Mil.
Depreciation, Depletion and Amortization(DDA) was $262 Mil.
Selling, General & Admin. Expense(SGA) was $3,281 Mil.
Total Current Liabilities was $4,693 Mil.
Long-Term Debt was $4,533 Mil.
Net Income was 309.071 + 211.723 + 238.31 + 373.67 = $1,133 Mil.
Non Operating Income was 0 + -69.072 + 0 + 0 = $-69 Mil.
Cash Flow from Operations was 522.574 + 101.31 + 375.228 + 370.116 = $1,369 Mil.
Accounts Receivable was $191 Mil.
Revenue was 2341.545 + 1990.494 + 2093.578 + 3095.414 = $9,521 Mil.
Gross Profit was 1216.958 + 1037.035 + 1085.697 + 1604.375 = $4,944 Mil.
Total Current Assets was $3,588 Mil.
Total Assets was $7,372 Mil.
Property, Plant and Equipment(Net PPE) was $3,193 Mil.
Depreciation, Depletion and Amortization(DDA) was $244 Mil.
Selling, General & Admin. Expense(SGA) was $3,108 Mil.
Total Current Liabilities was $4,604 Mil.
Long-Term Debt was $4,163 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)
=(212.068 / 9946.632) / (190.848 / 9521.031)
=0.02132058 / 0.02004489
=1.0636

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)
=(1120.033 / 9521.031) / (1302.789 / 9946.632)
=0.51927832 / 0.52225718
=0.9943

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 - (3950.49 + 3426.388) / 8032.44) / (1 - (3587.844 + 3193.289) / 7371.802)
=0.0816143 / 0.08012546
=1.0186

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
=9946.632 / 9521.031
=1.0447

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))
=(243.605 / (243.605 + 3193.289)) / (262.192 / (262.192 + 3426.388))
=0.0708794 / 0.0710821
=0.9971

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)
=(3280.719 / 9946.632) / (3107.823 / 9521.031)
=0.32983215 / 0.32641665
=1.0105

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)
=((4533.329 + 4693.102) / 8032.44) / ((4163.244 + 4603.952) / 7371.802)
=1.14864612 / 1.18928805
=0.9658

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
=(1132.774 - -69.072 - 1369.228) / 8032.44
=-0.0208

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.

AutoZone Inc has a M-score of -2.47 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.

AutoZone Inc Annual Data

Aug05Aug06Aug07Aug08Aug09Aug10Aug11Aug12Aug13Aug14
DSRI 1.70730.65240.71831.12541.69920.92071.01991.07621.00041.13
GMI 1.00010.98980.99470.99130.99970.99410.9880.99060.99390.9951
AQI 0.95040.88310.9430.97741.04341.04360.88120.98831.14541.0588
SGI 1.01311.04161.03721.05721.04511.08011.09651.06581.06321.0358
DEPI 0.87941.03320.93380.99940.96830.97451.06660.99181.00230.9766
SGAI 1.02021.01911.00431.00940.99990.98871.00061.00210.99581.0099
LVGI 0.93510.99891.01671.03251.12621.04461.07731.02361.00880.9752
TATA 0.006-0.0322-0.0271-0.0532-0.0502-0.0822-0.0754-0.0469-0.0578-0.0361
M-score -1.81-2.97-2.87-2.59-2.06-2.87-2.80-2.59-2.64-2.47

AutoZone Inc Quarterly Data

Feb13May13Aug13Nov13Feb14May14Aug14Nov14Feb15May15
DSRI 1.06061.11741.00040.93611.10711.1361.131.08350.98591.0636
GMI 0.98910.990.99390.99690.99790.99810.99510.99440.99480.9943
AQI 1.27561.24721.14541.11330.90940.9031.05881.0891.02291.0186
SGI 1.04471.03931.06321.06681.07611.081.03581.04241.04371.0447
DEPI 0.98950.98581.00230.98340.97860.97360.97660.97970.99520.9971
SGAI 1.00321.00150.99580.99440.99741.00191.00991.01361.01251.0105
LVGI 1.01280.99141.00881.00741.01411.02930.97520.97640.95860.9658
TATA -0.0359-0.0397-0.0458-0.0485-0.0393-0.0467-0.0256-0.0246-0.0166-0.0208
M-score -2.45-2.43-2.58-2.67-2.54-2.56-2.42-2.44-2.51-2.47
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