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Express Scripts Holding Co (NAS:ESRX)
Beneish M-Score
-2.69 (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 -2.63 suggests that the company is not a manipulator.

ESRX' s Beneish M-Score Range Over the Past 10 Years
Min: -3.09   Max: 2.37
Current: -2.69

-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 -2.52.


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 * 1.1402+0.528 * 0.9733+0.404 * 0.9859+0.892 * 1.0153+0.115 * 0.9197
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9314+4.679 * -0.0506-0.327 * 1.1287
=-2.63

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $7,391 Mil.
Revenue was 25222.6 + 25454.2 + 24899.6 + 26312.6 = $101,889 Mil.
Gross Profit was 2173.5 + 2131.2 + 1834 + 2094 = $8,233 Mil.
Total Current Assets was $10,274 Mil.
Total Assets was $51,997 Mil.
Property, Plant and Equipment(Net PPE) was $1,343 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,312 Mil.
Selling, General & Admin. Expense(SGA) was $4,164 Mil.
Total Current Liabilities was $16,014 Mil.
Long-Term Debt was $14,038 Mil.
Net Income was 661.7 + 600.1 + 441.1 + 581.8 = $2,285 Mil.
Non Operating Income was 0 + 0 + 0 + 18.7 = $19 Mil.
Cash Flow from Operations was 793 + 899.9 + 281.4 + 2924.4 = $4,899 Mil.
Accounts Receivable was $6,385 Mil.
Revenue was 25778.5 + 25111 + 23685 + 25781.4 = $100,356 Mil.
Gross Profit was 2073 + 2007.7 + 1750.4 + 2061 = $7,892 Mil.
Total Current Assets was $9,705 Mil.
Total Assets was $53,439 Mil.
Property, Plant and Equipment(Net PPE) was $1,640 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,281 Mil.
Selling, General & Admin. Expense(SGA) was $4,404 Mil.
Total Current Liabilities was $15,923 Mil.
Long-Term Debt was $11,442 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)
=(7391.1 / 101889) / (6384.5 / 100355.9)
=0.07254071 / 0.06361858
=1.1402

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)
=(2131.2 / 100355.9) / (2173.5 / 101889)
=0.07864112 / 0.08080068
=0.9733

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 - (10274.4 + 1343.1) / 51996.5) / (1 - (9704.7 + 1639.9) / 53439.2)
=0.7765715 / 0.78771015
=0.9859

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
=101889 / 100355.9
=1.0153

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))
=(2281.2 / (2281.2 + 1639.9)) / (2312.4 / (2312.4 + 1343.1))
=0.58177552 / 0.63258104
=0.9197

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)
=(4164.4 / 101889) / (4403.7 / 100355.9)
=0.04087193 / 0.04388083
=0.9314

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)
=((14037.7 + 16013.8) / 51996.5) / ((11442 + 15922.5) / 53439.2)
=0.57795236 / 0.51206792
=1.1287

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
=(2284.7 - 18.7 - 4898.7) / 51996.5
=-0.0506

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 -2.63 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

Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
DSRI 0.45110.66390.66780.96261.20571.31511.53381.48441.23031.1402
GMI 0.91290.94370.99931.00851.02361.0070.99450.99230.97940.9733
AQI 1.01780.99531.031.00150.95250.98240.95520.97531.01080.9859
SGI 1.68271.34631.11020.94530.94330.94960.96911.00331.01941.0153
DEPI 0.51940.73320.89630.99621.00771.02821.01690.98860.9530.9197
SGAI 1.23971.03480.91160.88540.95870.97850.97370.94930.93930.9314
LVGI 0.88530.92540.99081.02811.15891.13491.08991.05411.13951.1287
TATA -0.0462-0.0499-0.055-0.0468-0.0624-0.0494-0.0476-0.0438-0.0454-0.0506
M-score -2.69-2.76-2.93-2.77-2.68-2.51-2.28-2.26-2.51-2.63
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