Switch to:
Cyberonics Inc (NAS:CYBX)
Beneish M-Score
2.26 (As of Today)

Warning Sign:

Beneish M-Score 2.26 higher than -2.22, which implies that it might have manipulated its financial results.

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 2.27 signals that the company is a manipulator.

CYBX' s Beneish M-Score Range Over the Past 10 Years
Min: -10000000   Max: 7.02
Current: 2.26

-10000000
7.02

During the past 13 years, the highest Beneish M-Score of Cyberonics Inc was 7.02. The lowest was -10000000.00. And the median was -2.38.


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 * 1.7372+0.528 * 1.5446+0.404 * 6.3961+0.892 * 3.1365+0.115 * 0.6843
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9622+4.679 * -0.0183-0.327 * 1.584
=2.27

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

This Year (Jun16) TTM:Last Year (Jul15) TTM:
Accounts Receivable was $299.6 Mil.
Revenue was 321.047 + 286.969 + 267.175 + 67.521 = $942.7 Mil.
Gross Profit was 190.393 + 163.402 + 136.964 + 57.985 = $548.7 Mil.
Total Current Assets was $662.3 Mil.
Total Assets was $2,524.9 Mil.
Property, Plant and Equipment(Net PPE) was $245.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $60.7 Mil.
Selling, General & Admin. Expense(SGA) was $375.1 Mil.
Total Current Liabilities was $343.9 Mil.
Long-Term Debt was $85.4 Mil.
Net Income was 8.957 + -40.378 + -16.941 + -25.091 = $-73.5 Mil.
Non Operating Income was 0.617 + -1.835 + -10.406 + -0.109 = $-11.7 Mil.
Cash Flow from Operations was 2.984 + 9.6 + -58.745 + 30.719 = $-15.4 Mil.
Accounts Receivable was $55.0 Mil.
Revenue was 81.011 + 74.072 + 72.065 + 73.417 = $300.6 Mil.
Gross Profit was 71.578 + 66.477 + 65.525 + 66.651 = $270.2 Mil.
Total Current Assets was $263.6 Mil.
Total Assets was $338.2 Mil.
Property, Plant and Equipment(Net PPE) was $40.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $6.4 Mil.
Selling, General & Admin. Expense(SGA) was $124.3 Mil.
Total Current Liabilities was $36.3 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)
=(299.633 / 942.712) / (54.991 / 300.565)
=0.3178415 / 0.18295876
=1.7372

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)
=(270.231 / 300.565) / (548.744 / 942.712)
=0.89907674 / 0.58209082
=1.5446

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 - (662.338 + 245.006) / 2524.865) / (1 - (263.615 + 40.735) / 338.227)
=0.64063663 / 0.10016054
=6.3961

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
=942.712 / 300.565
=3.1365

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))
=(6.402 / (6.402 + 40.735)) / (60.669 / (60.669 + 245.006))
=0.13581687 / 0.19847551
=0.6843

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)
=(375.116 / 942.712) / (124.298 / 300.565)
=0.39791156 / 0.41354782
=0.9622

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)
=((85.364 + 343.913) / 2524.865) / ((0 + 36.303) / 338.227)
=0.17001978 / 0.10733324
=1.584

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
=(-73.453 - -11.733 - -15.442) / 2524.865
=-0.0183

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 2.27 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 1.00420.97321.01311.04190.960.98290.99570.9660.99581.012
AQI 0.802120.62150.9860.89030.624712.51621.15290.55330.78811.0921
SGI 0.93431.19331.0610.92561.18451.16831.13521.14721.16391.1089
DEPI 0.84911.78070.84490.85731.49571.22240.79891.63621.25291.1207
SGAI 1.28941.3230.92080.69220.83330.88720.8980.99720.94250.9669
LVGI 0.86854.1261.15850.93710.68350.34880.55330.78911.01120.9245
TATA -0.1490.0771-0.2193-0.1791-0.07580.2093-0.013-0.1812-0.11230.0034
M-score -3.305.06-3.66-3.22-2.713.56-2.26-3.35-2.77-2.13

Cyberonics Inc Quarterly Data

Apr14Jul14Oct14Jan15Apr15Jul15Oct15Dec15Mar16Jun16
DSRI 1.15841.11511.07361.05761.08020.92051.7372
GMI 1.0121.0071.00060.99721.00611.02091.5446
AQI 1.09211.09680.98350.95840.8360.83676.3961
SGI 1.10891.08471.06831.06111.05411.02153.1365
DEPI 1.12051.00980.96980.96140.93550.86290.6843
SGAI 0.96691.01011.00691.0050.94821.07040.9622
LVGI 0.92450.82310.90110.97861.28852.33361.584
TATA 0.0034-0.0106-0.0392-0.048-0.0645-0.1964-0.0183
M-score -2.13-2.25-2.51-2.61-2.82-3.972.27
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK