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GuruFocus has detected 3 Warning Signs with Bowl America Inc $BWL.A.
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Bowl America Inc (AMEX:BWL.A)
Beneish M-Score
-2.73 (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.

Bowl America Inc has a M-score of -2.73 suggests that the company is not a manipulator.

BWL.A' s Beneish M-Score Range Over the Past 10 Years
Min: -3.79   Max: 6.03
Current: -2.73

-3.79
6.03

During the past 13 years, the highest Beneish M-Score of Bowl America Inc was 6.03. The lowest was -3.79. And the median was -2.71.


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 Bowl America 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 * 0.7436+0.528 * 0.9866+0.404 * 1.1219+0.892 * 1.0435+0.115 * 1.1618
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9515+4.679 * -0.02-0.327 * 1.0888
=-2.73

* 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 $0.05 Mil.
Revenue was 6.235 + 5.064 + 5.75 + 7.421 = $24.47 Mil.
Gross Profit was 4.185 + 3.113 + 3.757 + 5.255 = $16.31 Mil.
Total Current Assets was $2.88 Mil.
Total Assets was $31.53 Mil.
Property, Plant and Equipment(Net PPE) was $19.13 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.05 Mil.
Selling, General & Admin. Expense(SGA) was $11.84 Mil.
Total Current Liabilities was $4.18 Mil.
Long-Term Debt was $0.00 Mil.
Net Income was 0.696 + -0.001 + 0.519 + 1.271 = $2.49 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 1.775 + 0.084 + -1.733 + 2.989 = $3.12 Mil.
Accounts Receivable was $0.06 Mil.
Revenue was 6.006 + 4.92 + 5.009 + 7.516 = $23.45 Mil.
Gross Profit was 3.996 + 2.94 + 3.239 + 5.246 = $15.42 Mil.
Total Current Assets was $3.04 Mil.
Total Assets was $31.33 Mil.
Property, Plant and Equipment(Net PPE) was $19.86 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.27 Mil.
Selling, General & Admin. Expense(SGA) was $11.92 Mil.
Total Current Liabilities was $3.82 Mil.
Long-Term Debt was $0.00 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)
=(0.045 / 24.47) / (0.058 / 23.451)
=0.00183899 / 0.00247324
=0.7436

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)
=(15.421 / 23.451) / (16.31 / 24.47)
=0.6575839 / 0.66653045
=0.9866

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 - (2.877 + 19.127) / 31.529) / (1 - (3.039 + 19.855) / 31.331)
=0.30210283 / 0.26928601
=1.1219

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
=24.47 / 23.451
=1.0435

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))
=(1.274 / (1.274 + 19.855)) / (1.047 / (1.047 + 19.127))
=0.06029628 / 0.05189848
=1.1618

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)
=(11.837 / 24.47) / (11.922 / 23.451)
=0.48373519 / 0.50837917
=0.9515

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 + 4.18) / 31.529) / ((0 + 3.815) / 31.331)
=0.13257636 / 0.12176439
=1.0888

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
=(2.485 - 0 - 3.115) / 31.529
=-0.02

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.

Bowl America Inc has a M-score of -2.73 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.

Bowl America Inc Annual Data

Jun07Jun08Jun09Jun10Jun11Jun12Jun13Jun14Jun15Jun16
DSRI 0.202810.53511.17891.62880.44461.23930.18855.65170.16050
GMI 0.9851.01661.03291.03411.01020.98110.98421.02880.98280.9859
AQI 1.68860.86180.91771.08121.16771.13691.09831.12991.0611.0057
SGI 1.05460.94150.98690.9130.97760.9180.980.95491.01511.0421
DEPI 0.84051.04170.97630.99211.06561.05970.99431.02281.02861.0385
SGAI 0.99061.03960.99091.02971.03161.02481.00491.0080.97190.9595
LVGI 0.88931.07711.02440.94681.07540.98561.12421.04391.0381.1474
TATA -0.042-0.0063-0.0802-0.0264-0.0482-0.03410.0258-0.0199-0.0441-0.0405
M-score -3.076.14-2.73-2.04-3.19-2.44-3.131.72-3.43-3.59

Bowl America Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 5.07152.268110.16050.23810.1779002.34580.7436
GMI 1.02371.01040.99140.98270.97650.98030.98020.98590.98670.9866
AQI 1.10751.08511.0641.0610.91480.940.98011.00571.13441.1219
SGI 0.96430.97120.99431.01511.03341.03481.02121.04211.03531.0435
DEPI 1.03431.04831.02581.02860.98430.95290.95011.03761.09041.1618
SGAI 1.00591.00150.9880.97190.95920.95950.96950.95950.95990.9515
LVGI 1.08491.09351.04861.0381.05051.08891.12711.14741.14521.0888
TATA -0.031-0.0328-0.0323-0.0441-0.0449-0.0446-0.0477-0.0405-0.0238-0.02
M-score 1.12-1.48-2.63-3.43-3.42-3.48-3.66-3.59-1.30-2.73
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