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First Cash Financial Services Inc (NAS:FCFS)
Beneish M-Score
-2.68 (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 -2.68 suggests that the company is not a manipulator.

FCFS' s Beneish M-Score Range Over the Past 10 Years
Min: -4.3   Max: 4.85
Current: -2.68

-4.3
4.85

During the past 13 years, the highest Beneish M-Score of First Cash Financial Services Inc was 4.85. The lowest was -4.30. And the median was -2.56.


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 * 0.9074+0.528 * 1.0028+0.404 * 1.0419+0.892 * 1.0297+0.115 * 0.9123
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0316+4.679 * -0.0229-0.327 * 1.0997
=-2.68

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $147.6 Mil.
Revenue was 169.532 + 167.623 + 176.023 + 202.774 = $716.0 Mil.
Gross Profit was 95.442 + 94.046 + 98.771 + 111.633 = $399.9 Mil.
Total Current Assets was $330.8 Mil.
Total Assets was $755.2 Mil.
Property, Plant and Equipment(Net PPE) was $110.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $18.1 Mil.
Selling, General & Admin. Expense(SGA) was $261.8 Mil.
Total Current Liabilities was $47.0 Mil.
Long-Term Debt was $268.5 Mil.
Net Income was 11.173 + 13.339 + 16.788 + 26.941 = $68.2 Mil.
Non Operating Income was -7.913 + 0 + 0 + 0 = $-7.9 Mil.
Cash Flow from Operations was 23.213 + 14.479 + 27.43 + 28.351 = $93.5 Mil.
Accounts Receivable was $158.0 Mil.
Revenue was 175 + 165.326 + 169.777 + 185.203 = $695.3 Mil.
Gross Profit was 98.863 + 93.921 + 96.456 + 100.192 = $389.4 Mil.
Total Current Assets was $308.2 Mil.
Total Assets was $704.7 Mil.
Property, Plant and Equipment(Net PPE) was $115.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $17.0 Mil.
Selling, General & Admin. Expense(SGA) was $246.5 Mil.
Total Current Liabilities was $50.2 Mil.
Long-Term Debt was $217.5 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)
=(147.6 / 715.952) / (157.972 / 695.306)
=0.20615907 / 0.22719781
=0.9074

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)
=(94.046 / 695.306) / (95.442 / 715.952)
=0.56008721 / 0.55854582
=1.0028

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 - (330.758 + 110.285) / 755.202) / (1 - (308.213 + 115.115) / 704.667)
=0.41599334 / 0.39925099
=1.0419

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
=715.952 / 695.306
=1.0297

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))
=(17.016 / (17.016 + 115.115)) / (18.126 / (18.126 + 110.285))
=0.12878129 / 0.14115613
=0.9123

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)
=(261.805 / 715.952) / (246.468 / 695.306)
=0.36567396 / 0.35447415
=1.0316

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)
=((268.5 + 46.972) / 755.202) / ((217.5 + 50.178) / 704.667)
=0.41773194 / 0.37986453
=1.0997

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
=(68.241 - -7.913 - 93.473) / 755.202
=-0.0229

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 -2.68 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

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 1.28670.99370.96730.77550.82460.88791.66271.16091.03681.0281
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 2.00841.73631.52080.37930.66450.94292.82111.27931.03611.0838
TATA -0.02150.0673-0.298-0.1383-0.0467-0.0073-0.0166-0.0347-0.01750.0906
M-score -2.06-2.57-3.95-2.78-2.38-2.45-2.54-2.57-2.55-2.09

First Cash Financial Services Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.95560.9940.99540.99461.05470.95020.93130.96560.90741.0001
GMI 1.0011.01331.01091.02961.0040.99450.99660.99161.00281.0129
AQI 1.14581.16091.13630.97811.00611.03681.05241.0891.04191.0281
SGI 1.16811.11611.08641.10571.0681.07871.07221.041.02970.9884
DEPI 0.94440.98150.96470.98520.98570.9340.93370.93180.91230.968
SGAI 1.01531.03891.0551.01831.03351.01831.01591.03481.03161.0467
LVGI 1.05341.27931.89151.02841.10681.03611.03791.13491.09971.0838
TATA -0.0359-0.0347-0.0298-0.034-0.027-0.0175-0.0293-0.0193-0.02290.0046
M-score -2.51-2.57-2.79-2.56-2.53-2.55-2.62-2.59-2.68-2.49
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