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CSX Corp (NYSE:CSX)
Beneish M-Score
-2.62 (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.

CSX Corp has a M-score of -2.62 suggests that the company is not a manipulator.

CSX' s 10-Year Beneish M-Score Range
Min: -3.54   Max: -1.14
Current: -2.62

-3.54
-1.14

During the past 13 years, the highest Beneish M-Score of CSX Corp was -1.14. The lowest was -3.54. And the median was -2.62.


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 CSX Corp 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 * 1.0187+0.528 * 0.9983+0.404 * 0.9656+0.892 * 1.0535+0.115 * 1.0044
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0267+4.679 * -0.042-0.327 * 0.9762
=-2.62

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $1,129 Mil.
Revenue was 3192 + 3221 + 3244 + 3012 = $12,669 Mil.
Gross Profit was 2100 + 2112 + 2093 + 1836 = $8,141 Mil.
Total Current Assets was $2,572 Mil.
Total Assets was $33,053 Mil.
Property, Plant and Equipment(Net PPE) was $28,584 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,151 Mil.
Selling, General & Admin. Expense(SGA) was $3,805 Mil.
Total Current Liabilities was $2,107 Mil.
Long-Term Debt was $9,514 Mil.
Net Income was 491 + 509 + 529 + 398 = $1,927 Mil.
Non Operating Income was 2 + -26 + -12 + 7 = $-29 Mil.
Cash Flow from Operations was 1041 + 857 + 846 + 599 = $3,343 Mil.
Accounts Receivable was $1,052 Mil.
Revenue was 3032 + 2985 + 3046 + 2963 = $12,026 Mil.
Gross Profit was 1897 + 1908 + 1993 + 1917 = $7,715 Mil.
Total Current Assets was $2,602 Mil.
Total Assets was $31,782 Mil.
Property, Plant and Equipment(Net PPE) was $27,291 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,104 Mil.
Selling, General & Admin. Expense(SGA) was $3,518 Mil.
Total Current Liabilities was $2,424 Mil.
Long-Term Debt was $9,022 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)
=(1129 / 12669) / (1052 / 12026)
=0.08911516 / 0.08747713
=1.0187

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)
=(2112 / 12026) / (2100 / 12669)
=0.64152669 / 0.64259215
=0.9983

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 - (2572 + 28584) / 33053) / (1 - (2602 + 27291) / 31782)
=0.05739267 / 0.05943616
=0.9656

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
=12669 / 12026
=1.0535

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))
=(1104 / (1104 + 27291)) / (1151 / (1151 + 28584))
=0.03888008 / 0.03870859
=1.0044

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)
=(3805 / 12669) / (3518 / 12026)
=0.30033941 / 0.29253285
=1.0267

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)
=((9514 + 2107) / 33053) / ((9022 + 2424) / 31782)
=0.35158685 / 0.36014096
=0.9762

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
=(1927 - -29 - 3343) / 33053
=-0.042

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.

CSX Corp has a M-score of -2.62 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.

CSX Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.96750.87990.95370.84031.11890.84830.91211.11210.92371.0187
GMI 0.93260.92180.93771.05110.96981.04451.03130.99160.99960.9983
AQI 1.03990.87170.81030.92981.01331.13391.00871.05041.06170.9656
SGI 1.07191.111.04851.12210.80331.17641.10411.00171.02241.0535
DEPI 0.890.99711.01351.00951.03220.98451.01750.96281.00471.0044
SGAI 0.97370.92170.9720.88191.27230.93760.93860.98671.00851.0267
LVGI 0.85690.94181.1411.05370.96231.03651.02280.98940.94590.9762
TATA 0.0052-0.0335-0.0345-0.0613-0.0342-0.0613-0.0575-0.0375-0.0442-0.042
M-score -2.40-2.71-2.79-2.80-2.75-2.67-2.71-2.53-2.70-2.62

CSX Corp Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 0.99461.11210.85060.83970.83910.92371.07071.07881.08761.0187
GMI 0.97090.99160.98730.98690.99380.99961.01911.02531.01460.9983
AQI 0.99071.05041.04741.08391.0831.06171.05811.03311.03080.9656
SGI 1.01851.00170.98830.99181.00521.02241.02681.04061.05251.0535
DEPI 1.03270.96280.96690.96450.97371.00471.00361.00110.99541.0044
SGAI 0.97670.98670.99721.00541.00491.00851.02081.01331.00981.0267
LVGI 0.99220.98940.96310.96440.94670.94590.9580.96390.99830.9762
TATA -0.0454-0.0375-0.0464-0.0458-0.0427-0.0442-0.0426-0.0412-0.0358-0.042
M-score -2.69-2.53-2.82-2.82-2.78-2.70-2.55-2.53-2.50-2.62
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