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Cintas Corp (NAS:CTAS)
Beneish M-Score
-2.94 (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.

Cintas Corp has a M-score of -2.94 suggests that the company is not a manipulator.

CTAS' s 10-Year Beneish M-Score Range
Min: -3.12   Max: -2.01
Current: -2.94

-3.12
-2.01

During the past 13 years, the highest Beneish M-Score of Cintas Corp was -2.01. The lowest was -3.12. And the median was -2.59.


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 Cintas 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 * 0.9661+0.528 * 0.9679+0.404 * 0.9022+0.892 * 1.0145+0.115 * 0.9739
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9912+4.679 * -0.0789-0.327 * 1.0441
=-2.94

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

This Year (Nov14) TTM:Last Year (Nov13) TTM:
Accounts Receivable was $510 Mil.
Revenue was 1123.379 + 1102.077 + 1157.479 + 1130.237 = $4,513 Mil.
Gross Profit was 481.424 + 477.946 + 492.362 + 479.125 = $1,931 Mil.
Total Current Assets was $2,146 Mil.
Total Assets was $4,698 Mil.
Property, Plant and Equipment(Net PPE) was $845 Mil.
Depreciation, Depletion and Amortization(DDA) was $149 Mil.
Selling, General & Admin. Expense(SGA) was $1,270 Mil.
Total Current Liabilities was $852 Mil.
Long-Term Debt was $1,300 Mil.
Net Income was 120.412 + 110.108 + 127.224 + 84.602 = $442 Mil.
Non Operating Income was 0 + 28.358 + 106.441 + 0 = $135 Mil.
Cash Flow from Operations was 144.372 + 148.201 + 222.196 + 163.493 = $678 Mil.
Accounts Receivable was $521 Mil.
Revenue was 1143.753 + 1100.246 + 1129.086 + 1075.674 = $4,449 Mil.
Gross Profit was 476.919 + 456.095 + 467.215 + 441.941 = $1,842 Mil.
Total Current Assets was $1,619 Mil.
Total Assets was $4,365 Mil.
Property, Plant and Equipment(Net PPE) was $989 Mil.
Depreciation, Depletion and Amortization(DDA) was $170 Mil.
Selling, General & Admin. Expense(SGA) was $1,263 Mil.
Total Current Liabilities was $615 Mil.
Long-Term Debt was $1,301 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)
=(510.153 / 4513.172) / (520.523 / 4448.759)
=0.11303646 / 0.11700409
=0.9661

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)
=(477.946 / 4448.759) / (481.424 / 4513.172)
=0.41408627 / 0.42782704
=0.9679

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 - (2145.98 + 845.127) / 4697.571) / (1 - (1618.782 + 988.897) / 4365.398)
=0.36326519 / 0.40264805
=0.9022

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
=4513.172 / 4448.759
=1.0145

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))
=(169.523 / (169.523 + 988.897)) / (149.452 / (149.452 + 845.127))
=0.14633984 / 0.1502666
=0.9739

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)
=(1269.76 / 4513.172) / (1262.692 / 4448.759)
=0.28134536 / 0.28383016
=0.9912

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)
=((1300 + 851.764) / 4697.571) / ((1300.615 + 614.561) / 4365.398)
=0.45805886 / 0.43871739
=1.0441

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
=(442.346 - 134.799 - 678.262) / 4697.571
=-0.0789

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.

Cintas Corp has a M-score of -2.94 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.

Cintas Corp Annual Data

May05May06May07May08May09May10May11May12May13May14
DSRI 1.05011.07490.96280.99020.86761.07761.10290.97591.04560.972
GMI 0.99120.99521.00190.9991.03940.97310.99970.99651.02380.9844
AQI 0.99751.14851.03560.9741.01320.94851.00061.02640.99241.0114
SGI 1.091.10961.08911.06230.95860.93981.07421.07651.05231.0545
DEPI 1.00510.97880.97710.97551.11941.01151.05640.97830.97790.875
SGAI 1.03171.00421.0111.03531.0231.09080.98050.95280.96841.0111
LVGI 0.94421.30971.01930.95940.84931.00821.34111.05441.02621.0123
TATA -0.0339-0.0329-0.0199-0.0544-0.0799-0.0882-0.0216-0.0413-0.0546-0.0762
M-score -2.50-2.51-2.52-2.69-2.93-2.93-2.52-2.63-2.64-2.84

Cintas Corp Quarterly Data

Aug12Nov12Feb13May13Aug13Nov13Feb14May14Aug14Nov14
DSRI 0.98721.0221.07831.04561.05551.02021.00740.97630.92070.9661
GMI 1.00441.01571.02321.02381.0251.01030.99650.98510.96890.9679
AQI 0.981.02681.03830.99241.00510.98110.971.01140.92310.9022
SGI 1.05961.0481.04441.05231.05541.0651.06191.04991.03851.0145
DEPI 0.94210.98760.97990.97791.01450.97111.03130.92990.96550.9739
SGAI 0.9510.95120.96660.96840.97660.99550.99711.00991.01110.9912
LVGI 1.00291.04671.06751.02621.03330.99270.98261.01231.00851.0441
TATA -0.0488-0.0502-0.0527-0.0546-0.052-0.0514-0.0539-0.0762-0.0881-0.0789
M-score -2.67-2.64-2.61-2.64-2.61-2.65-2.67-2.83-2.99-2.94
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