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Ebix, Inc. (NAS:EBIX)
Beneish M-Score
-2.35 (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.

Ebix, Inc. has a M-score of -2.35 suggests that the company is not a manipulator.

EBIX' s 10-Year Beneish M-Score Range
Min: -6.02   Max: 2.44
Current: -2.35

-6.02
2.44

During the past 13 years, the highest Beneish M-Score of Ebix, Inc. was 2.44. The lowest was -6.02. And the median was -2.35.


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 Ebix, 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 * 1.0202+0.528 * 1.008+0.404 * 0.9724+0.892 * 1.0268+0.115 * 0.8775
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0142+4.679 * 0.0115-0.327 * 0.8114
=-2.35

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $39.1 Mil.
Revenue was 50.847 + 50.293 + 51.004 + 52.566 = $204.7 Mil.
Gross Profit was 40.761 + 40.157 + 40.646 + 42.675 = $164.2 Mil.
Total Current Assets was $102.3 Mil.
Total Assets was $553.9 Mil.
Property, Plant and Equipment(Net PPE) was $8.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $10.1 Mil.
Selling, General & Admin. Expense(SGA) was $52.3 Mil.
Total Current Liabilities was $66.7 Mil.
Long-Term Debt was $43.0 Mil.
Net Income was 15.245 + 13.143 + 13.542 + 17.344 = $59.3 Mil.
Non Operating Income was 1.656 + -4.166 + -1.548 + -0.088 = $-4.1 Mil.
Cash Flow from Operations was 19.286 + 12.937 + 10.574 + 14.265 = $57.1 Mil.
Accounts Receivable was $37.3 Mil.
Revenue was 54.023 + 53.804 + 47.716 + 43.827 = $199.4 Mil.
Gross Profit was 43.576 + 44.304 + 38.559 + 34.798 = $161.2 Mil.
Total Current Assets was $81.7 Mil.
Total Assets was $516.9 Mil.
Property, Plant and Equipment(Net PPE) was $10.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $9.2 Mil.
Selling, General & Admin. Expense(SGA) was $50.2 Mil.
Total Current Liabilities was $56.7 Mil.
Long-Term Debt was $69.4 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)
=(39.07 / 204.71) / (37.298 / 199.37)
=0.19085536 / 0.1870793
=1.0202

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)
=(40.157 / 199.37) / (40.761 / 204.71)
=0.80873251 / 0.80230082
=1.008

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 - (102.349 + 8.528) / 553.864) / (1 - (81.669 + 10.082) / 516.946)
=0.79981187 / 0.82251338
=0.9724

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
=204.71 / 199.37
=1.0268

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))
=(9.155 / (9.155 + 10.082)) / (10.107 / (10.107 + 8.528))
=0.47590581 / 0.54236651
=0.8775

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)
=(52.328 / 204.71) / (50.249 / 199.37)
=0.25562015 / 0.25203892
=1.0142

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)
=((42.964 + 66.675) / 553.864) / ((69.432 + 56.69) / 516.946)
=0.19795293 / 0.24397519
=0.8114

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
=(59.274 - -4.146 - 57.062) / 553.864
=0.0115

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.

Ebix, Inc. has a M-score of -2.35 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.

Ebix, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.3160.89181.87570.75440.88231.28990.84140.93581.01531.0202
GMI 0.97390.96380.94580.95661.02881.03621.00790.96860.99071.008
AQI 11.90321.02971.16850.63841.87961.00010.97641.06390.9990.9724
SGI 1.38451.2061.21381.46451.74491.30681.35321.27821.17991.0268
DEPI 0.54750.95631.04221.03390.93471.39550.76720.94890.96580.8775
SGAI 0.82020.93690.88270.9050.85890.87681.031.02581.06711.0142
LVGI 0.98170.74461.37270.9621.15070.590.73341.03261.11470.8114
TATA -0.0197-0.04080.0385-0.0189-0.00070.0133-0.001-0.0102-0.00740.0115
M-score 2.44-2.50-1.36-2.52-1.59-1.66-2.27-2.35-2.40-2.35

Ebix, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 0.86990.93580.67940.85261.00611.01531.1180.98060.98871.0202
GMI 0.96370.96860.99020.98950.98520.99070.9790.98841.00561.008
AQI 1.0491.06391.02931.03440.99680.9991.010.99040.9920.9724
SGI 1.24631.27821.22831.18251.18361.17991.20471.18631.09761.0268
DEPI 0.93480.94890.9211.01151.00860.96580.89320.82240.84370.8775
SGAI 1.02561.02580.94531.06641.13871.06711.13071.00620.95281.0142
LVGI 0.77551.03261.21161.67191.37941.11471.12970.91980.77140.8114
TATA -0.007-0.0102-0.0133-0.0275-0.0178-0.0074-0.00550.01370.0240.0115
M-score -2.35-2.35-2.70-2.80-2.55-2.40-2.30-2.27-2.23-2.35
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