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GuruFocus has detected 3 Warning Signs with Buckle Inc $BKE.
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Buckle Inc (NYSE:BKE)
Beneish M-Score
-3.00 (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 -3.00 suggests that the company is not a manipulator.

BKE' s Beneish M-Score Range Over the Past 10 Years
Min: -3.78   Max: 4.32
Current: -3

-3.78
4.32

During the past 13 years, the highest Beneish M-Score of Buckle Inc was 4.32. The lowest was -3.78. And the median was -2.56.


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 * 1.1606+0.528 * 1.0377+0.404 * 0.5652+0.892 * 0.8999+0.115 * 0.9694
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0875+4.679 * -0.1003-0.327 * 0.8157
=-3.00

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

This Year (Oct16) TTM:Last Year (Oct15) TTM:
Accounts Receivable was $13 Mil.
Revenue was 239.213 + 212.157 + 243.543 + 332.031 = $1,027 Mil.
Gross Profit was 96.874 + 79.882 + 94.729 + 155.945 = $427 Mil.
Total Current Assets was $382 Mil.
Total Assets was $582 Mil.
Property, Plant and Equipment(Net PPE) was $175 Mil.
Depreciation, Depletion and Amortization(DDA) was $33 Mil.
Selling, General & Admin. Expense(SGA) was $247 Mil.
Total Current Liabilities was $87 Mil.
Long-Term Debt was $0 Mil.
Net Income was 23.397 + 15.472 + 23.097 + 54.339 = $116 Mil.
Non Operating Income was 0.497 + 0.595 + 0.408 + 3.277 = $5 Mil.
Cash Flow from Operations was 19.699 + 32.13 + 12.319 + 105.731 = $170 Mil.
Accounts Receivable was $13 Mil.
Revenue was 280.187 + 236.053 + 271.345 + 353.541 = $1,141 Mil.
Gross Profit was 117.264 + 94.595 + 113.597 + 167.415 = $493 Mil.
Total Current Assets was $367 Mil.
Total Assets was $590 Mil.
Property, Plant and Equipment(Net PPE) was $178 Mil.
Depreciation, Depletion and Amortization(DDA) was $32 Mil.
Selling, General & Admin. Expense(SGA) was $252 Mil.
Total Current Liabilities was $108 Mil.
Long-Term Debt was $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)
=(13.427 / 1026.944) / (12.855 / 1141.126)
=0.01307471 / 0.01126519
=1.1606

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)
=(492.871 / 1141.126) / (427.43 / 1026.944)
=0.43191637 / 0.41621549
=1.0377

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 - (381.933 + 174.96) / 581.571) / (1 - (367.235 + 178.372) / 589.893)
=0.04243334 / 0.07507463
=0.5652

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
=1026.944 / 1141.126
=0.8999

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))
=(32.034 / (32.034 + 178.372)) / (32.598 / (32.598 + 174.96))
=0.15224851 / 0.1570549
=0.9694

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)
=(246.787 / 1026.944) / (252.157 / 1141.126)
=0.24031203 / 0.22097209
=1.0875

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 + 87.244) / 581.571) / ((0 + 108.487) / 589.893)
=0.15001436 / 0.18390962
=0.8157

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
=(116.305 - 4.777 - 169.879) / 581.571
=-0.1003

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 -3.00 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

Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16
DSRI 0.79290.59181.04371.63191.96550.28520.71591.241.94081.1603
GMI 0.99010.95250.94680.97241.01071.00080.99251.00391.00581.0232
AQI 0.82931.95940.6891.19610.87410.57530.99711.04971.00950.7688
SGI 1.05781.16941.27771.13411.05741.11911.05741.00361.02230.9709
DEPI 0.87491.14681.05611.07450.97820.92150.94521.00671.10090.9884
SGAI 1.03030.96590.97910.97830.97960.99640.98151.00061.01141.0359
LVGI 1.10831.28221.12140.97951.03461.0611.30570.83710.9970.8345
TATA -0.0708-0.1221-0.0902-0.0722-0.0994-0.1166-0.1259-0.0273-0.0662-0.0302
M-score -3.08-2.98-2.80-2.03-2.06-3.78-3.39-2.31-1.89-2.53

Buckle Inc Quarterly Data

Jul14Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16Oct16
DSRI 1.81641.67531.94081.34431.27550.98271.16031.41051.14151.1606
GMI 1.00841.00931.00581.01131.01031.01941.02321.03141.0411.0377
AQI 0.9780.9881.00950.99491.10641.0010.76880.71450.62910.5652
SGI 0.98790.99041.02231.02021.01761.00220.97090.94710.92610.8999
DEPI 1.0291.0651.10091.09891.06521.03120.98840.96670.96840.9694
SGAI 0.99490.98521.01141.02371.02691.02891.03591.03981.05131.0875
LVGI 0.83730.89570.9971.0241.07520.98840.83450.8170.8730.8157
TATA -0.0614-0.061-0.0662-0.0586-0.0464-0.0144-0.0302-0.0318-0.0852-0.1003
M-score -1.97-2.11-1.89-2.42-2.40-2.55-2.53-2.35-2.91-3.00
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