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Express Scripts Holding Co (NAS:ESRX)
Beneish M-Score
-2.70 (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 -2.70 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: -2.7

-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 -2.54.


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 * 1.1666+0.528 * 0.9475+0.404 * 0.9719+0.892 * 0.9955+0.115 * 0.9216
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9278+4.679 * -0.0539-0.327 * 1.2524
=-2.70

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $6,758 Mil.
Revenue was 24791.8 + 26175.4 + 25222.6 + 25454.2 = $101,644 Mil.
Gross Profit was 1847 + 2263.2 + 2173.5 + 2131.2 = $8,415 Mil.
Total Current Assets was $10,400 Mil.
Total Assets was $51,108 Mil.
Property, Plant and Equipment(Net PPE) was $1,260 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,328 Mil.
Selling, General & Admin. Expense(SGA) was $3,961 Mil.
Total Current Liabilities was $17,237 Mil.
Long-Term Debt was $14,383 Mil.
Net Income was 526.1 + 773.5 + 661.7 + 600.1 = $2,561 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 751.2 + 2874 + 793 + 899.9 = $5,318 Mil.
Accounts Receivable was $5,819 Mil.
Revenue was 24899.6 + 26312.6 + 25778.5 + 25111 = $102,102 Mil.
Gross Profit was 1834 + 2094 + 2073 + 2007.7 = $8,009 Mil.
Total Current Assets was $9,172 Mil.
Total Assets was $51,905 Mil.
Property, Plant and Equipment(Net PPE) was $1,510 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,247 Mil.
Selling, General & Admin. Expense(SGA) was $4,289 Mil.
Total Current Liabilities was $14,900 Mil.
Long-Term Debt was $10,741 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)
=(6758.4 / 101644) / (5819.4 / 102101.7)
=0.06649089 / 0.05699611
=1.1666

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)
=(8008.7 / 102101.7) / (8414.9 / 101644)
=0.07843846 / 0.08278797
=0.9475

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 - (10399.8 + 1259.7) / 51107.6) / (1 - (9171.5 + 1510.2) / 51905.1)
=0.77186368 / 0.79420712
=0.9719

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
=101644 / 102101.7
=0.9955

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))
=(2246.5 / (2246.5 + 1510.2)) / (2327.7 / (2327.7 + 1259.7))
=0.59799824 / 0.64885432
=0.9216

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)
=(3961.4 / 101644) / (4288.9 / 102101.7)
=0.03897328 / 0.04200616
=0.9278

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)
=((14382.7 + 17236.9) / 51107.6) / ((10741.2 + 14900.2) / 51905.1)
=0.61868685 / 0.49400541
=1.2524

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
=(2561.4 - 0 - 5318.1) / 51107.6
=-0.0539

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 -2.70 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

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.85470.88550.81131.93330.37631.08531.3920.66851.53381.1144
GMI 0.86960.87681.04110.94561.4930.94530.8910.99970.99450.9513
AQI 1.1120.95171.00691.05931.10020.66611.72161.030.95490.9681
SGI 1.08571.03471.20271.12611.81721.02572.03471.10910.96911.0086
DEPI 0.94921.08441.021.270.60681.04730.70830.89651.01690.9069
SGAI 1.11471.01340.8961.08840.52390.98692.48730.90860.97370.9318
LVGI 1.04831.11240.91510.90360.91141.32260.60070.99081.08891.1221
TATA -0.0357-0.0456-0.0589-0.0791-0.0887-0.0587-0.0599-0.055-0.0476-0.0445
M-score -2.77-2.88-2.68-1.84-2.37-2.91-1.40-2.93-2.28-2.65

Express Scripts Holding Co Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 0.66780.96261.20571.31511.53381.48441.23031.14021.11441.1666
GMI 0.99931.00851.02361.0070.99450.99230.97940.97330.95130.9475
AQI 1.031.00150.95250.98240.95490.97531.01080.98590.96810.9719
SGI 1.11020.94530.94330.94960.96911.00331.01941.01531.00860.9955
DEPI 0.89630.99621.00771.02821.01690.98860.9530.91970.90690.9216
SGAI 0.91160.88540.95870.97850.97370.94930.93930.93140.93180.9278
LVGI 0.99081.02811.15891.13491.08891.05411.13951.12871.12211.2524
TATA -0.0544-0.0462-0.0618-0.0488-0.0473-0.0435-0.045-0.0503-0.0445-0.0539
M-score -2.92-2.76-2.68-2.50-2.28-2.26-2.51-2.63-2.65-2.70
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