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Express Scripts Holding Co (NAS:ESRX)
Beneish M-Score
-2.59 (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 -2.59 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: -2.59

-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 * 1.1469+0.528 * 0.9533+0.404 * 0.9743+0.892 * 0.9899+0.115 * 0.9542
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9203+4.679 * -0.0428-0.327 * 1.0375
=-2.59

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $7,374 Mil.
Revenue was 25222.3 + 24791.8 + 26175.4 + 25222.6 = $101,412 Mil.
Gross Profit was 2161.2 + 1847 + 2263.2 + 2173.5 = $8,445 Mil.
Total Current Assets was $10,615 Mil.
Total Assets was $50,859 Mil.
Property, Plant and Equipment(Net PPE) was $1,249 Mil.
Depreciation, Depletion and Amortization(DDA) was $2,288 Mil.
Selling, General & Admin. Expense(SGA) was $3,868 Mil.
Total Current Liabilities was $19,137 Mil.
Long-Term Debt was $11,843 Mil.
Net Income was 720.7 + 526.1 + 773.5 + 661.7 = $2,682 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 438.9 + 751.2 + 2874 + 793 = $4,857 Mil.
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.



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)
=(7373.6 / 101412.1) / (6494.5 / 102444.9)
=0.07270927 / 0.06339505
=1.1469

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)
=(8132.2 / 102444.9) / (8444.9 / 101412.1)
=0.07938121 / 0.0832731
=0.9533

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 - (10614.5 + 1249.1) / 50858.6) / (1 - (9637.7 + 1411.9) / 51867.8)
=0.76673365 / 0.78696609
=0.9743

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
=101412.1 / 102444.9
=0.9899

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))
=(2276.6 / (2276.6 + 1411.9)) / (2287.7 / (2287.7 + 1249.1))
=0.61721567 / 0.64682764
=0.9542

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)
=(3867.8 / 101412.1) / (4245.7 / 102444.9)
=0.03813943 / 0.04144374
=0.9203

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)
=((11842.6 + 19136.5) / 50858.6) / ((14583.9 + 15868.8) / 51867.8)
=0.60912215 / 0.58712149
=1.0375

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
=(2682 - 0 - 4857.1) / 50858.6
=-0.0428

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 -2.59 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 0.85470.88550.81131.9370.37561.08531.4060.66181.53381.1144
GMI 0.86960.87681.04110.94561.4930.94530.8910.99970.99450.9513
AQI 1.1120.95171.00691.05841.10120.66611.72151.03010.95520.9679
SGI 1.08571.03471.20271.12611.81721.02572.03471.10910.96911.0086
DEPI 0.94921.08441.021.28940.59761.04730.70870.8961.01690.9069
SGAI 1.11471.01340.8961.08840.52390.98692.48730.90860.97370.9318
LVGI 1.04831.11240.91510.90360.91141.32260.60070.99081.08991.1212
TATA -0.0357-0.0456-0.0589-0.0791-0.0887-0.0587-0.0599-0.055-0.0476-0.0445
M-score -2.77-2.88-2.68-1.83-2.37-2.91-1.39-2.93-2.28-2.65

Express Scripts Holding Co Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.96341.20561.31211.5351.48511.23031.14021.11441.16661.1469
GMI 1.00911.02261.00450.99450.99220.97940.97330.95130.94750.9533
AQI 1.00150.95250.98240.95520.97531.01080.98590.96790.97190.9743
SGI 0.94450.94340.95180.96831.00291.01941.01531.00860.99550.9899
DEPI 0.99651.00631.02461.01690.98860.95290.91970.90690.92160.9542
SGAI 0.89160.95660.98530.96980.94630.93930.93140.93180.92780.9203
LVGI 1.02811.15891.13491.08991.05411.13951.12871.12121.25241.0375
TATA -0.0469-0.0625-0.0497-0.0476-0.0438-0.0453-0.0504-0.0445-0.0539-0.0428
M-score -2.77-2.68-2.51-2.28-2.26-2.51-2.63-2.65-2.70-2.59
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