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GuruFocus has detected 4 Warning Signs with Buckle Inc $BKE.
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Buckle Inc (NYSE:BKE)
Beneish M-Score
-3.16 (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.

Buckle Inc has a M-score of -3.16 suggests that the company is not a manipulator.

BKE' s Beneish M-Score Range Over the Past 10 Years
Min: -3.78   Max: 2.44
Current: -3.16

-3.78
2.44

During the past 13 years, the highest Beneish M-Score of Buckle Inc was 2.44. The lowest was -3.78. And the median was -2.61.


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 Buckle 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 * 0.977+0.528 * 1.0554+0.404 * 0.6496+0.892 * 0.8707+0.115 * 0.9653
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1147+4.679 * -0.0938-0.327 * 0.9051
=-3.16

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

This Year (Jan17) TTM:Last Year (Jan16) TTM:
Accounts Receivable was $8.2 Mil.
Revenue was 279.96 + 239.213 + 212.157 + 243.543 = $974.9 Mil.
Gross Profit was 125.683 + 96.874 + 79.882 + 94.729 = $397.2 Mil.
Total Current Assets was $386.5 Mil.
Total Assets was $579.8 Mil.
Property, Plant and Equipment(Net PPE) was $169.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $32.8 Mil.
Selling, General & Admin. Expense(SGA) was $244.4 Mil.
Total Current Liabilities was $98.6 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 35.995 + 23.397 + 15.472 + 23.097 = $98.0 Mil.
Non Operating Income was 2.011 + 0.497 + 0.595 + 0.408 = $3.5 Mil.
Cash Flow from Operations was 84.718 + 19.699 + 32.13 + 12.319 = $148.9 Mil.
Accounts Receivable was $9.7 Mil.
Revenue was 332.031 + 280.187 + 236.053 + 271.345 = $1,119.6 Mil.
Gross Profit was 155.945 + 117.264 + 94.595 + 113.597 = $481.4 Mil.
Total Current Assets was $362.9 Mil.
Total Assets was $572.8 Mil.
Property, Plant and Equipment(Net PPE) was $172.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $32.1 Mil.
Selling, General & Admin. Expense(SGA) was $251.8 Mil.
Total Current Liabilities was $107.6 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)
=(8.21 / 974.873) / (9.651 / 1119.616)
=0.00842161 / 0.00861992
=0.977

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)
=(481.401 / 1119.616) / (397.168 / 974.873)
=0.42996974 / 0.40740486
=1.0554

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 - (386.457 + 168.995) / 579.847) / (1 - (362.897 + 172.781) / 572.773)
=0.04207144 / 0.06476388
=0.6496

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
=974.873 / 1119.616
=0.8707

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))
=(32.142 / (32.142 + 172.781)) / (32.787 / (32.787 + 168.995))
=0.15684916 / 0.16248724
=0.9653

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)
=(244.408 / 974.873) / (251.813 / 1119.616)
=0.25070753 / 0.22491015
=1.1147

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 + 98.616) / 579.847) / ((0 + 107.626) / 572.773)
=0.17007245 / 0.18790341
=0.9051

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
=(97.961 - 3.511 - 148.866) / 579.847
=-0.0938

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.

Buckle Inc has a M-score of -3.16 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.

Buckle Inc Annual Data

Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16Jan17
DSRI 0.59181.04371.63191.96550.28520.71591.241.94081.16030.977
GMI 0.95250.94680.97241.01071.00080.99251.00391.00581.02321.0554
AQI 1.95940.6891.19610.87410.57530.99711.04971.00950.76880.6496
SGI 1.16941.27771.13411.05741.11911.05741.00361.02230.97090.8707
DEPI 1.14681.05611.07450.97820.92150.94521.00671.10090.98840.9653
SGAI 0.96590.97910.97830.97960.99640.98151.00061.01141.03591.1147
LVGI 1.28221.12140.97951.03461.0611.30570.83710.9970.83450.9051
TATA -0.1221-0.0902-0.0722-0.0994-0.1166-0.1259-0.0273-0.0662-0.0302-0.0938
M-score -2.98-2.80-2.03-2.06-3.78-3.39-2.31-1.89-2.53-3.16

Buckle Inc Quarterly Data

Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16Oct16Jan17
DSRI 1.67531.94081.34431.27550.98271.16031.41051.14151.16060.977
GMI 1.00931.00581.01131.01031.01941.02321.03141.0411.03771.0554
AQI 0.9881.00950.99491.10641.0010.76880.71450.62910.56520.6496
SGI 0.99041.02231.02021.01761.00220.97090.94710.92610.89990.8707
DEPI 1.0651.10091.09891.06521.03120.98840.96670.96840.96940.9653
SGAI 0.98521.01141.02371.02691.02891.03591.03981.05131.08751.1147
LVGI 0.89570.9971.0241.07520.98840.83450.8170.8730.81570.9051
TATA -0.061-0.0662-0.0586-0.0464-0.0144-0.0302-0.0318-0.0852-0.1003-0.0938
M-score -2.11-1.89-2.42-2.40-2.55-2.53-2.35-2.91-3.00-3.16
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