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CSX Corp (NYSE:CSX)
Beneish M-Score
-2.70 (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 -2.55 suggests that the company is not a manipulator.

CSX' s 10-Year Beneish M-Score Range
Min: -3.54   Max: -1.14
Current: -2.7

-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 * 1.0703+0.528 * 1.0189+0.404 * 1.0581+0.892 * 1.0272+0.115 * 1.0036
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0204+4.679 * -0.0425-0.327 * 0.958
=-2.55

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $1,073 Mil.
Revenue was 3012 + 3000 + 2999 + 3069 = $12,080 Mil.
Gross Profit was 1836 + 1865 + 1922 + 2016 = $7,639 Mil.
Total Current Assets was $2,289 Mil.
Total Assets was $31,680 Mil.
Property, Plant and Equipment(Net PPE) was $27,494 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,117 Mil.
Selling, General & Admin. Expense(SGA) was $3,571 Mil.
Total Current Liabilities was $2,212 Mil.
Long-Term Debt was $9,021 Mil.
Net Income was 398 + 407 + 463 + 535 = $1,803 Mil.
Non Operating Income was 7 + -8 + 5 + 9 = $13 Mil.
Cash Flow from Operations was 599 + 768 + 920 + 848 = $3,135 Mil.
Accounts Receivable was $976 Mil.
Revenue was 2963 + 2891 + 2894 + 3012 = $11,760 Mil.
Gross Profit was 1917 + 1834 + 1876 + 1950 = $7,577 Mil.
Total Current Assets was $2,567 Mil.
Total Assets was $30,586 Mil.
Property, Plant and Equipment(Net PPE) was $26,288 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,072 Mil.
Selling, General & Admin. Expense(SGA) was $3,407 Mil.
Total Current Liabilities was $2,474 Mil.
Long-Term Debt was $8,846 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)
=(1073 / 12080) / (976 / 11760)
=0.0888245 / 0.0829932
=1.0703

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)
=(1865 / 11760) / (1836 / 12080)
=0.64430272 / 0.63236755
=1.0189

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 - (2289 + 27494) / 31680) / (1 - (2567 + 26288) / 30586)
=0.05988005 / 0.05659452
=1.0581

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
=12080 / 11760
=1.0272

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))
=(1072 / (1072 + 26288)) / (1117 / (1117 + 27494))
=0.03918129 / 0.03904093
=1.0036

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)
=(3571 / 12080) / (3407 / 11760)
=0.29561258 / 0.28971088
=1.0204

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)
=((9021 + 2212) / 31680) / ((8846 + 2474) / 30586)
=0.35457702 / 0.37010397
=0.958

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
=(1803 - 13 - 3135) / 31680
=-0.0425

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 -2.55 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.96590.96750.87990.95370.84031.11890.84830.91211.11210.9237
GMI 0.98610.93260.92181.00230.98350.96981.04451.03130.99160.9996
AQI 0.23921.03990.87170.81030.92981.01331.13391.00871.05041.0617
SGI 1.03171.07191.111.04851.12210.80331.17641.10411.00171.0224
DEPI 1.2670.890.99711.01351.00951.03220.98451.01750.96281.0047
SGAI 2.67840.97371.08110.95370.76621.27230.93760.93860.98671.0085
LVGI 0.930.85690.94181.1411.05370.96231.03651.02280.98940.9459
TATA -0.04790.0052-0.0335-0.0345-0.0613-0.0342-0.0613-0.0575-0.0375-0.0442
M-score -3.26-2.40-2.74-2.75-2.82-2.75-2.67-2.71-2.53-2.70

CSX Corp Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.91211.00080.97170.99461.11210.85060.8380.83650.92331.0703
GMI 1.00341.00140.99760.97090.99160.98730.98590.99210.99931.0189
AQI 1.00870.99941.00110.99071.05041.04741.08391.0831.06171.0581
SGI 1.10411.08621.05141.01851.00170.98830.99371.00841.02281.0272
DEPI 1.01751.02071.02751.03270.96280.96690.96450.97371.00471.0036
SGAI 0.93860.94610.95980.97670.98670.99721.00341.00181.00811.0204
LVGI 1.02281.07491.01420.99220.98940.96310.96440.94670.94590.958
TATA -0.0575-0.0542-0.0452-0.0454-0.0375-0.0464-0.0453-0.042-0.0441-0.0425
M-score -2.73-2.67-2.67-2.69-2.53-2.82-2.81-2.78-2.70-2.55
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