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CSX Corp (NYSE:CSX)
Beneish M-Score
-2.53 (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 -2.53 suggests that the company is not a manipulator.

CSX' s 10-Year Beneish M-Score Range
Min: -4.35   Max: -1.14
Current: -2.53

-4.35
-1.14

During the past 13 years, the highest Beneish M-Score of CSX Corp was -1.14. The lowest was -4.35. 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 * 1.0804+0.528 * 1.0262+0.404 * 1.0331+0.892 * 1.0391+0.115 * 1.0011
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0148+4.679 * -0.0415-0.327 * 0.9639
=-2.53

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $1,062 Mil.
Revenue was 3244 + 3012 + 3000 + 2999 = $12,255 Mil.
Gross Profit was 2093 + 1836 + 1865 + 1922 = $7,716 Mil.
Total Current Assets was $2,372 Mil.
Total Assets was $31,975 Mil.
Property, Plant and Equipment(Net PPE) was $27,685 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,128 Mil.
Selling, General & Admin. Expense(SGA) was $3,621 Mil.
Total Current Liabilities was $2,797 Mil.
Long-Term Debt was $8,410 Mil.
Net Income was 529 + 398 + 407 + 463 = $1,797 Mil.
Non Operating Income was -12 + 7 + -8 + 5 = $-8 Mil.
Cash Flow from Operations was 846 + 599 + 768 + 920 = $3,133 Mil.
Accounts Receivable was $946 Mil.
Revenue was 3046 + 2963 + 2891 + 2894 = $11,794 Mil.
Gross Profit was 1993 + 1917 + 1834 + 1876 = $7,620 Mil.
Total Current Assets was $2,489 Mil.
Total Assets was $30,881 Mil.
Property, Plant and Equipment(Net PPE) was $26,599 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,085 Mil.
Selling, General & Admin. Expense(SGA) was $3,434 Mil.
Total Current Liabilities was $2,418 Mil.
Long-Term Debt was $8,811 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)
=(1062 / 12255) / (946 / 11794)
=0.08665851 / 0.08021028
=1.0804

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)
=(1836 / 11794) / (2093 / 12255)
=0.64609123 / 0.62962056
=1.0262

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 - (2372 + 27685) / 31975) / (1 - (2489 + 26599) / 30881)
=0.05998436 / 0.05806159
=1.0331

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
=12255 / 11794
=1.0391

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))
=(1085 / (1085 + 26599)) / (1128 / (1128 + 27685))
=0.03919231 / 0.039149
=1.0011

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)
=(3621 / 12255) / (3434 / 11794)
=0.29547124 / 0.291165
=1.0148

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)
=((8410 + 2797) / 31975) / ((8811 + 2418) / 30881)
=0.35049257 / 0.36362164
=0.9639

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
=(1797 - -8 - 3133) / 31975
=-0.0415

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 -2.53 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 0.98610.93260.92180.93771.05110.96981.04451.03130.99160.9996
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 2.67840.97370.92170.9720.88191.27230.93760.93860.98671.0085
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 -3.26-2.40-2.71-2.79-2.80-2.75-2.67-2.71-2.53-2.70

CSX Corp Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 1.00080.97170.99461.11210.85060.83970.83810.92511.07231.0804
GMI 1.00140.99760.97090.99160.98730.98690.99321.00041.021.0262
AQI 0.99941.00110.99071.05041.04741.08391.0831.06171.05811.0331
SGI 1.08621.05141.01851.00170.98830.99181.00641.02081.02531.0391
DEPI 1.02071.02751.03270.96280.96690.96450.97371.00471.00361.0011
SGAI 0.94610.95980.97670.98670.99721.00541.00371.011.02231.0148
LVGI 1.07491.01420.99220.98940.96310.96440.94670.94590.9580.9639
TATA -0.0542-0.0452-0.0454-0.0375-0.0464-0.0458-0.0424-0.0446-0.0429-0.0415
M-score -2.67-2.67-2.69-2.53-2.82-2.82-2.78-2.70-2.55-2.53
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