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FirstCash Inc (NYSE:FCFS)
Beneish M-Score
-2.77 (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.

FirstCash Inc has a M-score of -2.77 suggests that the company is not a manipulator.

FCFS' s Beneish M-Score Range Over the Past 10 Years
Min: -4.33   Max: 4.7
Current: -2.77

-4.33
4.7

During the past 13 years, the highest Beneish M-Score of FirstCash Inc was 4.70. The lowest was -4.33. And the median was -2.61.


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 FirstCash 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 * 1.0649+0.528 * 1.0106+0.404 * 1.0241+0.892 * 1.0065+0.115 * 1.0471
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.044+4.679 * -0.0774-0.327 * 1.0074
=-2.77

* 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 $154.0 Mil.
Revenue was 181.979 + 183.203 + 191.424 + 169.532 = $726.1 Mil.
Gross Profit was 101.461 + 101.863 + 102.925 + 95.442 = $401.7 Mil.
Total Current Assets was $299.9 Mil.
Total Assets was $756.6 Mil.
Property, Plant and Equipment(Net PPE) was $123.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $18.8 Mil.
Selling, General & Admin. Expense(SGA) was $273.9 Mil.
Total Current Liabilities was $52.6 Mil.
Long-Term Debt was $246.7 Mil.
Net Income was 11.673 + 13.174 + 19.41 + 11.173 = $55.4 Mil.
Non Operating Income was 4.102 + 4.186 + 23.234 + -7.913 = $23.6 Mil.
Cash Flow from Operations was 14.497 + 25.076 + 27.627 + 23.213 = $90.4 Mil.
Accounts Receivable was $143.7 Mil.
Revenue was 167.623 + 176.023 + 202.774 + 175 = $721.4 Mil.
Gross Profit was 94.046 + 98.771 + 111.633 + 98.863 = $403.3 Mil.
Total Current Assets was $313.0 Mil.
Total Assets was $744.6 Mil.
Property, Plant and Equipment(Net PPE) was $111.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $17.9 Mil.
Selling, General & Admin. Expense(SGA) was $260.7 Mil.
Total Current Liabilities was $40.8 Mil.
Long-Term Debt was $251.6 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)
=(153.977 / 726.138) / (143.65 / 721.42)
=0.21204922 / 0.19912118
=1.0649

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)
=(403.313 / 721.42) / (401.691 / 726.138)
=0.55905437 / 0.55318824
=1.0106

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 - (299.893 + 123.895) / 756.604) / (1 - (313.013 + 111.754) / 744.57)
=0.43988136 / 0.42951368
=1.0241

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
=726.138 / 721.42
=1.0065

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))
=(17.893 / (17.893 + 111.754)) / (18.809 / (18.809 + 123.895))
=0.13801322 / 0.13180429
=1.0471

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)
=(273.922 / 726.138) / (260.666 / 721.42)
=0.37723133 / 0.3613235
=1.044

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)
=((246.703 + 52.615) / 756.604) / ((251.564 + 40.829) / 744.57)
=0.39560721 / 0.39270048
=1.0074

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
=(55.43 - 23.609 - 90.413) / 756.604
=-0.0774

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.

FirstCash Inc has a M-score of -2.77 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.

FirstCash Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.62950.63440.9591.07211.11630.82751.2280.9940.95021.0001
GMI 1.00061.01981.02391.03210.99711.03790.9931.01330.99451.0129
AQI 1.28670.99370.96730.77550.82460.88791.66271.16091.0661
SGI 1.18411.17931.14411.13231.16081.21961.15191.11611.07870.9884
DEPI 0.95070.95850.95391.2091.23311.16841.06910.98150.9340.968
SGAI 0.99510.96760.94250.9670.99310.90331.00851.03891.01831.0467
LVGI 2.00841.73631.52080.37930.66450.94292.82111.27931.03331.0867
TATA -0.02060.0671-0.3008-0.141-0.0475-0.0069-0.0166-0.0395-0.0354-0.0626
M-score -2.05-2.57-3.96-2.80-2.39-2.45-2.54-2.59-2.62-2.82

FirstCash Inc Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.99540.99461.05470.95020.93130.96560.90741.00011.11141.0649
GMI 1.01091.02961.0040.99450.99660.99161.00281.01291.01221.0106
AQI 1.13630.97811.00611.0661.07111.10321.041911.05841.0241
SGI 1.08641.10571.0681.07871.07221.041.02970.98840.98981.0065
DEPI 0.96470.98520.98570.9340.93370.93180.91230.9681.03311.0471
SGAI 1.0551.01831.03351.01831.01591.03041.02721.04231.05041.044
LVGI 1.89151.02841.10681.03331.0241.12551.09971.08671.08041.0074
TATA -0.0344-0.0385-0.0315-0.0354-0.0529-0.0466-0.0498-0.0723-0.075-0.0774
M-score -2.81-2.58-2.55-2.62-2.72-2.71-2.80-2.86-2.74-2.77
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