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Express Scripts Holding Co (NAS:ESRX)
Beneish M-Score
-2.51 (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.

Express Scripts Holding Co has a M-score of -2.51 suggests that the company is not a manipulator.

ESRX' s 10-Year Beneish M-Score Range
Min: -3.09   Max: 2.37
Current: -2.51

-3.09
2.37

During the past 13 years, the highest Beneish M-Score of Express Scripts Holding Co was 2.37. The lowest was -3.09. And the median was -2.51.


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 Express Scripts Holding Co 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 * 1.2303+0.528 * 0.9794+0.404 * 1.0108+0.892 * 1.0194+0.115 * 0.953
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9393+4.679 * -0.0453-0.327 * 1.1395
=-2.51

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $6,495 Mil.
Revenue was 25454.2 + 24899.6 + 26312.6 + 25778.5 = $102,445 Mil.
Gross Profit was 2131.2 + 1834 + 2094 + 2073 = $8,132 Mil.
Total Current Assets was $9,638 Mil.
Total Assets was $51,868 Mil.
Property, Plant and Equipment(Net PPE) was $1,412 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,277 Mil.
Selling, General & Admin. Expense(SGA) was $4,246 Mil.
Total Current Liabilities was $15,869 Mil.
Long-Term Debt was $14,584 Mil.
Net Income was 600.1 + 441.1 + 581.8 + 582.3 = $2,205 Mil.
Non Operating Income was 0 + 0 + 5.1 + 7.2 = $12 Mil.
Cash Flow from Operations was 899.9 + 281.4 + 2924.4 + 435.1 = $4,541 Mil.
Accounts Receivable was $5,178 Mil.
Revenue was 25111 + 23685 + 25781.4 + 25915.6 = $100,493 Mil.
Gross Profit was 2007.7 + 1750.4 + 2061 + 1994.2 = $7,813 Mil.
Total Current Assets was $10,452 Mil.
Total Assets was $54,634 Mil.
Property, Plant and Equipment(Net PPE) was $1,644 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,349 Mil.
Selling, General & Admin. Expense(SGA) was $4,434 Mil.
Total Current Liabilities was $15,984 Mil.
Long-Term Debt was $12,166 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)
=(6494.5 / 102444.9) / (5178.2 / 100493)
=0.06339505 / 0.05152797
=1.2303

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)
=(1834 / 100493) / (2131.2 / 102444.9)
=0.07774969 / 0.07938121
=0.9794

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 - (9637.7 + 1411.9) / 51867.8) / (1 - (10452.4 + 1644.1) / 54633.8)
=0.78696609 / 0.77858944
=1.0108

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
=102444.9 / 100493
=1.0194

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))
=(2348.5 / (2348.5 + 1644.1)) / (2276.6 / (2276.6 + 1411.9))
=0.58821319 / 0.61721567
=0.953

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)
=(4245.7 / 102444.9) / (4433.8 / 100493)
=0.04144374 / 0.04412049
=0.9393

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)
=((14583.9 + 15868.8) / 51867.8) / ((12165.5 + 15984.4) / 54633.8)
=0.58712149 / 0.51524697
=1.1395

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
=(2205.3 - 12.3 - 4540.8) / 51867.8
=-0.0453

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.

Express Scripts Holding Co has a M-score of -2.51 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.

Express Scripts Holding Co Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.23060.85570.88020.81131.93530.37591.08531.39410.66751.5338
GMI 0.8490.87490.86991.04110.94711.49060.94530.89190.99870.9945
AQI 1.00651.1120.95171.00691.05931.10020.66611.72161.030.9552
SGI 1.0711.08441.0411.20271.12491.81911.02572.03161.11080.9691
DEPI 0.94580.88081.07581.021.29890.59321.04730.70850.89631.0169
SGAI 1.13581.09271.04210.8961.08320.52650.9842.48340.91270.9737
LVGI 1.11791.04831.11240.91510.90360.91141.32260.60070.99081.0899
TATA -0.0711-0.0357-0.0456-0.0589-0.0791-0.0887-0.0588-0.0599-0.055-0.0476
M-score -2.68-2.77-2.89-2.68-1.83-2.38-2.91-1.40-2.93-2.28

Express Scripts Holding Co Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 0.93680.45110.66390.66780.96261.20571.31511.53381.48441.2303
GMI 0.89040.91290.94370.99931.00851.02361.0070.99450.99230.9794
AQI 2.24611.01780.99531.031.00150.95250.98240.95520.97531.0108
SGI 2.28241.68271.34631.11020.94530.94330.94960.96911.00331.0194
DEPI 0.65630.51940.73320.89630.99621.00771.02821.01690.98860.953
SGAI 2.43621.23971.03480.91160.88540.95870.97850.97370.94930.9393
LVGI 0.55160.88530.92540.99081.02811.15891.13491.08991.05411.1395
TATA -0.0687-0.0462-0.0499-0.055-0.0468-0.0624-0.0496-0.0475-0.0437-0.0453
M-score -1.41-2.69-2.76-2.93-2.77-2.68-2.51-2.28-2.26-2.51
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