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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.
Dollar Tree Stores Inc has a M-score of -2.59 suggests that the company is not a manipulator.
During the past 13 years, the highest Beneish M-Score of Dollar Tree Stores Inc was -1.96. The lowest was -3.66. And the median was -2.72.
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 Dollar Tree Stores 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||+||0.528 * 1.0194||+||0.404 * 1.1046||+||0.892 * 1.065||+||0.115 * 1.0044|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 0.9937||+||4.679 * -0.0618||-||0.327 * 0.7835|
|This Year (Oct14) TTM:||Last Year (Oct13) TTM:|
|Accounts Receivable was $0 Mil.|
Revenue was 2095.2 + 2031.1 + 2000.3 + 2234.9 = $8,362 Mil.
Gross Profit was 725.3 + 694.1 + 696.6 + 825.2 = $2,941 Mil.
Total Current Assets was $1,796 Mil.
Total Assets was $3,368 Mil.
Property, Plant and Equipment(Net PPE) was $1,193 Mil.
Depreciation, Depletion and Amortization(DDA) was $202 Mil.
Selling, General & Admin. Expense(SGA) was $1,936 Mil.
Total Current Liabilities was $867 Mil.
Long-Term Debt was $757 Mil.
Net Income was 133 + 121.5 + 138.3 + 213.1 = $606 Mil.
Non Operating Income was -1.1 + 0 + 0 + -0.1 = $-1 Mil.
Cash Flow from Operations was 23.2 + 167.1 + 198.2 + 426.7 = $815 Mil.
|Accounts Receivable was $0 Mil.
Revenue was 1884.7 + 1854.9 + 1865.8 + 2245.8 = $7,851 Mil.
Gross Profit was 659.9 + 648.7 + 656 + 850.8 = $2,815 Mil.
Total Current Assets was $1,488 Mil.
Total Assets was $2,883 Mil.
Property, Plant and Equipment(Net PPE) was $1,102 Mil.
Depreciation, Depletion and Amortization(DDA) was $187 Mil.
Selling, General & Admin. Expense(SGA) was $1,830 Mil.
Total Current Liabilities was $767 Mil.
Long-Term Debt was $1,007 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(0 / 8361.5)||/||(0 / 7851.2)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(694.1 / 7851.2)||/||(725.3 / 8361.5)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (1796.1 + 1193.4) / 3367.7)||/||(1 - (1487.8 + 1101.9) / 2882.8)|
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.
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))|
|=||(187.2 / (187.2 + 1101.9))||/||(201.7 / (201.7 + 1193.4))|
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)|
|=||(1936.4 / 8361.5)||/||(1829.7 / 7851.2)|
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)|
|=||((757 + 866.5) / 3367.7)||/||((1007 + 766.8) / 2882.8)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(605.9 - -1.2||-||815.2)||/||3367.7|
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.
Dollar Tree Stores Inc has a M-score of -2.59 suggests that the company will not be a manipulator.
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
Dollar Tree Stores Inc Annual Data
Dollar Tree Stores Inc Quarterly Data