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Express, Inc. (NYSE:EXPR)
Beneish M-Score
-2.29 (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, Inc. has a M-score of -2.29 suggests that the company is not a manipulator.

EXPR' s 10-Year Beneish M-Score Range
Min: -2.97   Max: -1.89
Current: -2.29

-2.97
-1.89

During the past 7 years, the highest Beneish M-Score of Express, Inc. was -1.89. The lowest was -2.97. 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, Inc. 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 * 1.517+0.528 * 1.0747+0.404 * 0.9049+0.892 * 0.9822+0.115 * 1.1456
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0663+4.679 * -0.0683-0.327 * 0.8687
=-2.29

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

This Year (Jul14) TTM:Last Year (Jul13) TTM:
Accounts Receivable was $20 Mil.
Revenue was 481.42 + 460.652 + 721.451 + 502.992 = $2,167 Mil.
Gross Profit was 136.025 + 137.373 + 229.118 + 165.265 = $668 Mil.
Total Current Assets was $567 Mil.
Total Assets was $1,199 Mil.
Property, Plant and Equipment(Net PPE) was $410 Mil.
Depreciation, Depletion and Amortization(DDA) was $74 Mil.
Selling, General & Admin. Expense(SGA) was $517 Mil.
Total Current Liabilities was $277 Mil.
Long-Term Debt was $199 Mil.
Net Income was 6.867 + 5.083 + 47.926 + 19.267 = $79 Mil.
Non Operating Income was 0.022 + 0.025 + -2.529 + 0.153 = $-2 Mil.
Cash Flow from Operations was 35.992 + -31.187 + 157.435 + 1.107 = $163 Mil.
Accounts Receivable was $14 Mil.
Revenue was 490.075 + 509.362 + 737.869 + 468.527 = $2,206 Mil.
Gross Profit was 152.547 + 170.777 + 255.813 + 151.538 = $731 Mil.
Total Current Assets was $548 Mil.
Total Assets was $1,094 Mil.
Property, Plant and Equipment(Net PPE) was $322 Mil.
Depreciation, Depletion and Amortization(DDA) was $69 Mil.
Selling, General & Admin. Expense(SGA) was $494 Mil.
Total Current Liabilities was $302 Mil.
Long-Term Debt was $199 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)
=(20.129 / 2166.515) / (13.51 / 2205.833)
=0.00929096 / 0.00612467
=1.517

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)
=(137.373 / 2205.833) / (136.025 / 2166.515)
=0.33124674 / 0.30822819
=1.0747

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 - (567.183 + 409.857) / 1198.922) / (1 - (547.895 + 322.201) / 1093.791)
=0.18506792 / 0.20451348
=0.9049

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
=2166.515 / 2205.833
=0.9822

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))
=(68.544 / (68.544 + 322.201)) / (74.104 / (74.104 + 409.857))
=0.17541875 / 0.15311978
=1.1456

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)
=(517.261 / 2166.515) / (493.896 / 2205.833)
=0.23875256 / 0.22390453
=1.0663

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)
=((199.345 + 277.331) / 1198.922) / ((199.003 + 301.599) / 1093.791)
=0.39758717 / 0.4576761
=0.8687

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
=(79.143 - -2.329 - 163.347) / 1198.922
=-0.0683

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, Inc. has a M-score of -2.29 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, Inc. Annual Data

Jan08Jan09Jan10Jan11Jan12Jan13Jan14
DSRI 0.83751.17371.5329
GMI 0.97811.0571.0644
AQI 0.99020.85810.8546
SGI 1.08791.04051.0287
DEPI 1.06251.17811.25
SGAI 0.96450.97660.9972
LVGI 0.74180.88050.8395
TATA -0.0835-0.1276-0.0651
M-score -2.86-2.84-2.21

Express, Inc. Quarterly Data

Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14
DSRI 1.34151.32831.15611.17371.3051.05041.72931.52971.88281.517
GMI 0.98731.0041.02621.0571.09011.08931.06021.06671.06121.0747
AQI 0.95050.98790.9820.85810.85460.80530.82120.85460.87750.9049
SGI 1.07971.06311.0351.04051.03271.0451.07061.03091.00210.9822
DEPI 1.09421.12861.20451.17811.21711.20521.19351.251.21621.1456
SGAI 0.96750.96390.98770.97660.97130.97210.96410.9951.04781.0663
LVGI 0.72580.77220.8010.88050.87960.85220.87390.83950.86450.8687
TATA -0.0915-0.1091-0.1075-0.128-0.0959-0.0925-0.0735-0.0647-0.0576-0.0683
M-score -2.44-2.54-2.71-2.85-2.56-2.78-2.06-2.21-1.89-2.29
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