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First Cash Financial Services, Inc. (NAS:FCFS)
Beneish M-Score
-2.57 (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.

First Cash Financial Services, Inc. has a M-score of -2.57 suggests that the company is not a manipulator.

FCFS' s 10-Year Beneish M-Score Range
Min: -4   Max: 2.83
Current: -2.57

-4
2.83

During the past 13 years, the highest Beneish M-Score of First Cash Financial Services, Inc. was 2.83. The lowest was -4.00. And the median was -2.57.


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 First Cash Financial Services, 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 * 0.994+0.528 * 1.0133+0.404 * 1.1609+0.892 * 1.1161+0.115 * 0.9815
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0389+4.679 * -0.0347-0.327 * 1.2793
=-2.57

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

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Accounts Receivable was $133.4 Mil.
Revenue was 182.687 + 174.187 + 143.135 + 160.839 = $660.8 Mil.
Gross Profit was 98.189 + 94.553 + 84.75 + 92.082 = $369.6 Mil.
Total Current Assets was $290.2 Mil.
Total Assets was $659.0 Mil.
Property, Plant and Equipment(Net PPE) was $108.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $15.4 Mil.
Selling, General & Admin. Expense(SGA) was $230.9 Mil.
Total Current Liabilities was $48.8 Mil.
Long-Term Debt was $187.0 Mil.
Net Income was 24.778 + 23.141 + 15.663 + 20.264 = $83.8 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.0 Mil.
Cash Flow from Operations was 32.699 + 28.972 + 19.853 + 25.194 = $106.7 Mil.
Accounts Receivable was $120.2 Mil.
Revenue was 175.385 + 149.695 + 132.385 + 134.626 = $592.1 Mil.
Gross Profit was 96.711 + 85.938 + 74.828 + 78.061 = $335.5 Mil.
Total Current Assets was $241.4 Mil.
Total Assets was $507.7 Mil.
Property, Plant and Equipment(Net PPE) was $93.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $13.0 Mil.
Selling, General & Admin. Expense(SGA) was $199.1 Mil.
Total Current Liabilities was $31.2 Mil.
Long-Term Debt was $110.9 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)
=(133.373 / 660.848) / (120.218 / 592.091)
=0.20182099 / 0.20303974
=0.994

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)
=(94.553 / 592.091) / (98.189 / 660.848)
=0.56670005 / 0.55924206
=1.0133

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 - (290.222 + 108.137) / 658.973) / (1 - (241.43 + 93.304) / 507.692)
=0.3954851 / 0.34067505
=1.1609

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
=660.848 / 592.091
=1.1161

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))
=(12.975 / (12.975 + 93.304)) / (15.361 / (15.361 + 108.137))
=0.12208433 / 0.12438258
=0.9815

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)
=(230.851 / 660.848) / (199.09 / 592.091)
=0.34932541 / 0.33624899
=1.0389

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)
=((187.026 + 48.761) / 658.973) / ((110.851 + 31.15) / 507.692)
=0.3578098 / 0.27969911
=1.2793

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
=(83.846 - 0 - 106.718) / 658.973
=-0.0347

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.

First Cash Financial Services, Inc. has a M-score of -2.57 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.

First Cash Financial Services, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.94970.76851.45030.70930.85771.07211.11630.82061.23840.994
GMI 1.00481.02671.00061.01981.02391.03210.99711.03410.99661.0133
AQI 0.87220.8691.28670.99370.96730.77550.82460.88791.66271.1609
SGI 1.23611.11621.18411.17931.14411.13231.16081.22991.14231.1161
DEPI 0.89410.97990.95070.95850.95391.2091.23311.16841.06910.9815
SGAI 0.95810.96520.99510.96760.94250.9670.99310.91091.00021.0389
LVGI 0.49181.3272.00841.73631.52080.37930.66450.94292.82111.2793
TATA -0.1455-0.0916-0.02150.0673-0.298-0.1383-0.0467-0.0073-0.0166-0.0347
M-score -2.88-3.16-2.22-2.50-4.04-2.78-2.38-2.45-2.53-2.57

First Cash Financial Services, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
DSRI 0.85460.81920.94860.97081.23741.24051.11761.08990.96050.994
GMI 1.0051.03381.03271.02941.01830.99690.99930.98611.00281.0133
AQI 0.81480.88791.56571.6071.63691.66271.11761.21691.14581.1609
SGI 1.23111.2321.19081.15141.12341.14031.161.15461.16351.1161
DEPI 1.18471.16841.19731.09651.16951.06910.9840.96940.94440.9815
SGAI 0.93690.91190.93130.94950.9820.99910.99331.02411.01221.0389
LVGI 0.98740.94291.49672.52392.78482.82111.10851.2921.05341.2793
TATA -0.0077-0.0073-0.031-0.027-0.0123-0.0166-0.0035-0.0203-0.0359-0.0347
M-score -2.48-2.45-2.38-2.72-2.50-2.53-2.23-2.38-2.50-2.57
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