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Express Scripts Holding Co (NAS:ESRX)
Beneish M-Score
-2.82 (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 -2.82 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: -2.82

-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 -2.55.


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 * 0.9453+0.528 * 0.9607+0.404 * 0.9746+0.892 * 0.9972+0.115 * 0.9867
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8955+4.679 * -0.055-0.327 * 1.0503
=-2.82

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $6,967 Mil.
Revenue was 25410.1 + 25222.3 + 24791.8 + 26175.4 = $101,600 Mil.
Gross Profit was 2274.1 + 2161.2 + 1847 + 2263.2 = $8,546 Mil.
Total Current Assets was $11,123 Mil.
Total Assets was $50,909 Mil.
Property, Plant and Equipment(Net PPE) was $1,256 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,243 Mil.
Selling, General & Admin. Expense(SGA) was $3,719 Mil.
Total Current Liabilities was $15,979 Mil.
Long-Term Debt was $14,925 Mil.
Net Income was 722.9 + 720.7 + 526.1 + 773.5 = $2,743 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 1480.4 + 438.9 + 751.2 + 2874 = $5,545 Mil.
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.



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)
=(6967 / 101599.6) / (7391.1 / 101889)
=0.0685731 / 0.07254071
=0.9453

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)
=(8232.7 / 101889) / (8545.5 / 101599.6)
=0.08080068 / 0.08410958
=0.9607

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 - (11123 + 1255.5) / 50909.3) / (1 - (10274.4 + 1343.1) / 51996.5)
=0.75685189 / 0.7765715
=0.9746

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
=101599.6 / 101889
=0.9972

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))
=(2312.4 / (2312.4 + 1343.1)) / (2242.6 / (2242.6 + 1255.5))
=0.63258104 / 0.64109088
=0.9867

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)
=(3718.6 / 101599.6) / (4164.4 / 101889)
=0.03660054 / 0.04087193
=0.8955

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)
=((14924.5 + 15978.5) / 50909.3) / ((14037.7 + 16013.8) / 51996.5)
=0.60702072 / 0.57795236
=1.0503

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
=(2743.2 - 0 - 5544.5) / 50909.3
=-0.055

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 -2.82 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 local exchange's currency.

Express Scripts Holding Co Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.85570.88020.81131.93530.37591.08531.39410.66751.53381.1144
GMI 0.87490.86991.04110.94711.49060.94530.89190.99870.99450.9513
AQI 1.1120.95171.00691.05931.10020.66611.72161.030.95490.9681
SGI 1.08441.0411.20271.12491.81911.02572.03161.11080.96911.0086
DEPI 0.88081.07581.021.29890.59321.04730.70850.89631.01690.9069
SGAI 1.09271.04210.8961.08320.52650.9842.48340.91270.97370.9318
LVGI 1.04831.11240.91510.90360.91141.32260.60070.99081.08891.1221
TATA -0.0357-0.0456-0.0589-0.0791-0.0887-0.0588-0.0599-0.0544-0.0473-0.0445
M-score -2.77-2.89-2.68-1.83-2.38-2.91-1.40-2.92-2.28-2.65

Express Scripts Holding Co Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 1.20571.31511.53381.48441.23031.14021.11441.16661.14690.9453
GMI 1.02361.0070.99450.99230.97940.97330.95130.94750.95330.9607
AQI 0.95250.98240.95490.97531.01080.98590.96810.97190.97430.9746
SGI 0.94330.94960.96911.00331.01941.01531.00860.99550.98990.9972
DEPI 1.00771.02821.01690.98860.9530.91970.90690.92160.95420.9867
SGAI 0.95870.97850.97370.94930.93930.93140.93180.92780.92030.8955
LVGI 1.15891.13491.08891.05411.13951.12871.12211.25241.03751.0503
TATA -0.0618-0.0488-0.0473-0.0435-0.045-0.0503-0.0445-0.0539-0.0428-0.055
M-score -2.68-2.50-2.28-2.26-2.51-2.63-2.65-2.70-2.59-2.82
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