Laboratory of America Holdings (FRA:LAB) Beneish M-Score : -2.89 (As of Apr. 30, 2024)

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What is Laboratory of America Holdings Beneish M-Score?

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.89 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Laboratory of America Holdings's Beneish M-Score or its related term are showing as below:

FRA:LAB' s Beneish M-Score Range Over the Past 10 Years
Min: -2.89 Med: -2.45 Max: -1.91
Current: -2.89

During the past 13 years, the highest Beneish M-Score of Laboratory of America Holdings was -1.91. The lowest was -2.89. And the median was -2.45.

Laboratory of America Holdings Beneish M-Score Historical Data

The historical data trend for Laboratory of America Holdings's Beneish M-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

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Laboratory of America Holdings Beneish M-Score Chart

Laboratory of America Holdings Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.54

-2.20

-2.68

-2.74

-2.60

Laboratory of America Holdings Quarterly Data
	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24
Beneish M-Score	Get a 7-Day Free Trial															-2.45	-2.79	-2.75	-2.60	-2.89

Competitive Comparison of Laboratory of America Holdings's Beneish M-Score

For the Diagnostics & Research subindustry, Laboratory of America Holdings's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

Laboratory of America Holdings's Beneish M-Score Distribution in the Medical Diagnostics & Research Industry

For the Medical Diagnostics & Research industry and Healthcare sector, Laboratory of America Holdings's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Laboratory of America Holdings's Beneish M-Score falls into.

Laboratory of America Holdings Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Laboratory of America Holdings for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 0.7486

0.528 * 1.0404

0.404 * 0.99

0.892 * 0.9509

0.115 * 0.9676

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.1106

4.679 * -0.025499

0.327 * 1.0817

-2.91

This Year (Mar24) TTM:

Last Year (Mar23) TTM:

Total Receivables was €2,028 Mil.
Revenue was 2922.472 + 2781.536 + 2864.222 + 2800.105 = €11,368 Mil.
Gross Profit was 825.516 + 753.224 + 797.574 + 777.351 = €3,154 Mil.
Total Current Assets was €3,180 Mil.
Total Assets was €15,209 Mil.
Property, Plant and Equipment(Net PPE) was €2,666 Mil.
Depreciation, Depletion and Amortization(DDA) was €523 Mil.
Selling, General, & Admin. Expense(SGA) was €1,916 Mil.
Total Current Liabilities was €3,626 Mil.
Long-Term Debt & Capital Lease Obligation was €3,449 Mil.
Net Income was 209.76 + -153.231 + 171.752 + 174.355 = €403 Mil.
Non Operating Income was 14.26 + -300.409 + 17.803 + -27.782 = €-296 Mil.
Cash Flow from Operations was -27.416 + 531.493 + 258.144 + 324.342 = €1,087 Mil.

Total Receivables was €2,849 Mil.
Revenue was 3528.559 + 2765.637 + 2895.468 + 2765.158 = €11,955 Mil.
Gross Profit was 910.37 + 753.406 + 895.062 + 891.605 = €3,450 Mil.
Total Current Assets was €4,385 Mil.
Total Assets was €18,867 Mil.
Property, Plant and Equipment(Net PPE) was €2,750 Mil.
Depreciation, Depletion and Amortization(DDA) was €519 Mil.
Selling, General, & Admin. Expense(SGA) was €1,814 Mil.
Total Current Liabilities was €2,695 Mil.
Long-Term Debt & Capital Lease Obligation was €5,420 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total 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)
	=	(2027.772 / 11368.335)	/	(2848.607 / 11954.822)
	=	0.17837	/	0.238281
	=	0.7486

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)
	=	(3450.443 / 11954.822)	/	(3153.665 / 11368.335)
	=	0.288624	/	0.277408
	=	1.0404

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 Property, Plant and Equipment to Total Assets.

AQI	=	(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)	/	(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
	=	(1 - (3179.98 + 2665.976) / 15208.52)	/	(1 - (4385.13 + 2749.789) / 18866.8)
	=	0.615613	/	0.621827
	=	0.99

4. SGI = Sales Growth Index

Ratio of Revenue 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
	=	11368.335	/	11954.822
	=	0.9509

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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))
	=	(518.685 / (518.685 + 2749.789))	/	(523.026 / (523.026 + 2665.976))
	=	0.158693	/	0.164009
	=	0.9676

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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)
	=	(1915.644 / 11368.335)	/	(1813.836 / 11954.822)
	=	0.168507	/	0.151724
	=	1.1106

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 in leverage

LVGI	=	((LTD_t + CurrentLiabilities_t) / TotalAssets_t)	/	((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
	=	((3449.356 + 3626.18) / 15208.52)	/	((5419.628 + 2695.15) / 18866.8)
	=	0.465235	/	0.430109
	=	1.0817

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
	=	(402.636 - -296.128	-	1086.563)	/	15208.52
	=	-0.025499

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Laboratory of America Holdings has a M-score of -2.91 suggests that the company is unlikely to be a manipulator.

Laboratory of America Holdings Beneish M-Score Related Terms

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Laboratory of America Holdings (FRA:LAB) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Medical Diagnostics & Research » Laboratory Corp of America Holdings (FRA:LAB) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

LH:USA LH:Mexico L1CA34:Brazil

Address

358 South Main Street, Burlington, NC, USA, 27215

Website

https://www.labcorp.com

Laboratory Corp. of America is one of the nation's two largest independent clinical laboratories, with roughly 20% of the independent lab market. The company operates approximately 2,000 patient-service centers, offering a broad range of 5,000 clinical lab tests, ranging from routine blood and urine screens to complex oncology and genomic testing.