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Cyberonics Inc (NAS:CYBX)
Beneish M-Score
2.27 (As of Today)

Warning Sign:

Beneish M-Score 2.27 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: 2.27

-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 -2.40.


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 * 3.847+0.528 * 1.3423+0.404 * 5.805+0.892 * 1.4832+0.115 * 1.5119
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0676+4.679 * -0.0413-0.327 * 1.8451
=2.27

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

This Year (Mar16) TTM:Last Year (Apr15) TTM:
Accounts Receivable was $288.5 Mil.
Revenue was 286.969 + 0 + 67.521 + 81.011 = $435.5 Mil.
Gross Profit was 163.402 + 0 + 57.985 + 71.578 = $293.0 Mil.
Total Current Assets was $683.7 Mil.
Total Assets was $2,617.7 Mil.
Property, Plant and Equipment(Net PPE) was $253.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $27.2 Mil.
Selling, General & Admin. Expense(SGA) was $190.5 Mil.
Total Current Liabilities was $381.5 Mil.
Long-Term Debt was $99.2 Mil.
Net Income was -40.378 + 0 + -25.091 + 12.419 = $-53.1 Mil.
Non Operating Income was -1.835 + 0 + -0.109 + -2.068 = $-4.0 Mil.
Cash Flow from Operations was 9.6 + 0 + 30.719 + 18.738 = $59.1 Mil.
Accounts Receivable was $50.6 Mil.
Revenue was 74.072 + 74.072 + 72.065 + 73.417 = $293.6 Mil.
Gross Profit was 66.477 + 66.477 + 65.525 + 66.651 = $265.1 Mil.
Total Current Assets was $240.7 Mil.
Total Assets was $315.9 Mil.
Property, Plant and Equipment(Net PPE) was $40.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $6.9 Mil.
Selling, General & Admin. Expense(SGA) was $120.3 Mil.
Total Current Liabilities was $31.4 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)
=(288.537 / 435.501) / (50.569 / 293.626)
=0.66254038 / 0.17222249
=3.847

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)
=(0 / 293.626) / (163.402 / 435.501)
=0.90295137 / 0.67270798
=1.3423

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 - (683.669 + 253.75) / 2617.71) / (1 - (240.721 + 40.287) / 315.944)
=0.64189349 / 0.11057656
=5.805

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
=435.501 / 293.626
=1.4832

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))
=(6.895 / (6.895 + 40.287)) / (27.152 / (27.152 + 253.75))
=0.14613624 / 0.09666005
=1.5119

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)
=(190.467 / 435.501) / (120.282 / 293.626)
=0.43735146 / 0.40964356
=1.0676

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)
=((99.222 + 381.548) / 2617.71) / ((0 + 31.449) / 315.944)
=0.18366053 / 0.09953979
=1.8451

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
=(-53.05 - -4.012 - 59.057) / 2617.71
=-0.0413

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 1.0040.97431.01311.04190.960.98290.99570.9660.99581.012
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 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

Apr14Jul14Oct14Jan15Mar15Apr15Jul15Oct15Dec15Mar16
DSRI 1.15841.11511.07361.05761.01681.08670.95013.847
GMI 1.0121.0071.00060.99721.00181.01081.02521.3423
AQI 1.09211.09680.98350.95840.92290.86460.82285.805
SGI 1.10891.08471.06831.06111.02971.04421.01481.4832
DEPI 1.12051.00980.96980.96140.86950.87590.80941.5119
SGAI 0.96691.01011.00691.0050.93920.95851.04841.0676
LVGI 0.92450.82310.90110.97861.1951.26152.27671.8451
TATA 0.0034-0.0106-0.0392-0.048-0.0738-0.0601-0.1999-0.0413
M-score -2.13-2.25-2.51-2.61-2.88-2.78-3.952.27
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