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Cyberonics Inc (NAS:CYBX)
Beneish M-Score
-2.13 (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.

Cyberonics Inc has a M-score of -2.13 signals that the company is a manipulator.

CYBX' s 10-Year Beneish M-Score Range
Min: -3.66   Max: 7.11
Current: -2.13

-3.66
7.11

During the past 13 years, the highest Beneish M-Score of Cyberonics Inc was 7.11. The lowest was -3.66. And the median was -2.27.


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 Cyberonics 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 * 1.1584+0.528 * 1.012+0.404 * 1.092+0.892 * 1.1089+0.115 * 1.1254
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9669+4.679 * 0.0034-0.327 * 0.9245
=-2.13

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

This Year (Apr14) TTM:Last Year (Apr13) TTM:
Accounts Receivable was $50.7 Mil.
Revenue was 74.849 + 68.191 + 70.101 + 68.872 = $282.0 Mil.
Gross Profit was 67.425 + 61.731 + 63.175 + 62.328 = $254.7 Mil.
Total Current Assets was $220.4 Mil.
Total Assets was $294.2 Mil.
Property, Plant and Equipment(Net PPE) was $39.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $5.6 Mil.
Selling, General & Admin. Expense(SGA) was $120.6 Mil.
Total Current Liabilities was $29.9 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 18.428 + 13.9 + 13.888 + 8.674 = $54.9 Mil.
Non Operating Income was -0.089 + -0.035 + -0.041 + -0.131 = $-0.3 Mil.
Cash Flow from Operations was 16.448 + 15.631 + 12.629 + 9.488 = $54.2 Mil.
Accounts Receivable was $39.5 Mil.
Revenue was 68.344 + 62.7 + 62.956 + 60.321 = $254.3 Mil.
Gross Profit was 61.985 + 57.333 + 57.786 + 55.31 = $232.4 Mil.
Total Current Assets was $207.4 Mil.
Total Assets was $264.0 Mil.
Property, Plant and Equipment(Net PPE) was $28.6 Mil.
Depreciation, Depletion and Amortization(DDA) was $4.6 Mil.
Selling, General & Admin. Expense(SGA) was $112.5 Mil.
Total Current Liabilities was $29.0 Mil.
Long-Term Debt was $0.0 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)
=(50.674 / 282.013) / (39.45 / 254.321)
=0.17968675 / 0.15511892
=1.1584

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)
=(61.731 / 254.321) / (67.425 / 282.013)
=0.91386083 / 0.90300447
=1.012

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 - (220.431 + 39.535) / 294.191) / (1 - (207.358 + 28.556) / 264.043)
=0.11633599 / 0.10653189
=1.092

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
=282.013 / 254.321
=1.1089

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))
=(4.637 / (4.637 + 28.556)) / (5.603 / (5.603 + 39.535))
=0.13969813 / 0.12413044
=1.1254

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)
=(120.641 / 282.013) / (112.515 / 254.321)
=0.42778524 / 0.44241333
=0.9669

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 + 29.898) / 294.191) / ((0 + 29.025) / 264.043)
=0.10162785 / 0.10992528
=0.9245

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
=(54.89 - -0.296 - 54.196) / 294.191
=0.0034

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.

Cyberonics Inc has a M-score of -2.13 signals that the company is likely to 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.

Cyberonics Inc Annual Data

Apr05Apr06Apr07Apr08Apr09Apr10Apr11Apr12Apr13Apr14
DSRI 1.04041.08550.83531.14460.93741.00720.96140.89271.15811.1584
GMI 1.0040.97431.01311.04190.960.98290.99570.9660.99581.012
AQI 0.802120.62150.9860.89030.624712.51621.15290.55330.78811.092
SGI 0.93431.19331.0610.92561.18451.16831.13521.14721.16391.1089
DEPI 1.19391.02460.84490.85731.49571.22240.91451.42321.25841.1258
SGAI 1.23461.4130.92080.69220.83330.88720.8980.99720.94250.9669
LVGI 0.86854.1261.15850.93710.68350.34880.55330.78911.01120.9245
TATA -0.08430.0771-0.2193-0.1791-0.07580.2093-0.013-0.1812-0.11230.0034
M-score -2.954.95-3.66-3.22-2.713.56-2.24-3.38-2.77-2.13

Cyberonics Inc Quarterly Data

Jan12Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14
DSRI 1.00080.89270.93671.06371.1551.15811.08170.99881.04331.1584
GMI 0.97950.9660.95120.96390.97970.99581.01181.01511.01461.012
AQI 0.76530.55330.52440.53530.59640.78810.8670.939111.092
SGI 1.13331.14721.14031.15091.14891.16391.16231.14691.13111.1089
DEPI 1.9041.42321.24070.66150.71241.25871.4471.48151.4661.1254
SGAI 0.99830.99730.97340.94810.93750.94250.9310.94280.96360.9669
LVGI 0.73140.78910.76330.77440.90981.01121.13460.91681.03040.9245
TATA -0.1623-0.1812-0.1789-0.1393-0.1179-0.1174-0.1084-0.078-0.05230.0034
M-score -3.03-3.38-3.36-3.10-2.92-2.79-2.80-2.64-2.51-2.13
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