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Forward Air Corp (NAS:FWRD)
Beneish M-Score
-2.97 (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.

Forward Air Corp has a M-score of -2.97 suggests that the company is not a manipulator.

FWRD' s 10-Year Beneish M-Score Range
Min: -3.78   Max: 47.03
Current: -2.97

-3.78
47.03

During the past 13 years, the highest Beneish M-Score of Forward Air Corp was 47.03. The lowest was -3.78. 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 Forward Air Corp 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 * 1.0316+0.528 * 1.015+0.404 * 1.1917+0.892 * 1.2158+0.115 * 0.791
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0957+4.679 * -0.0289-0.327 * 2.891
=-2.97

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $122.4 Mil.
Revenue was 249.694 + 205.918 + 214.062 + 201.477 = $871.2 Mil.
Gross Profit was 119.747 + 91.675 + 102.854 + 98.341 = $412.6 Mil.
Total Current Assets was $193.3 Mil.
Total Assets was $709.4 Mil.
Property, Plant and Equipment(Net PPE) was $173.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $34.6 Mil.
Selling, General & Admin. Expense(SGA) was $283.5 Mil.
Total Current Liabilities was $116.7 Mil.
Long-Term Debt was $56.9 Mil.
Net Income was 11.824 + 4.837 + 17.046 + 16.744 = $50.5 Mil.
Non Operating Income was -0.089 + -0.048 + 0.145 + -0.055 = $-0.0 Mil.
Cash Flow from Operations was 11.103 + 7.459 + 26.567 + 25.878 = $71.0 Mil.
Accounts Receivable was $97.6 Mil.
Revenue was 193.852 + 171.569 + 181.085 + 170.033 = $716.5 Mil.
Gross Profit was 97.681 + 80.734 + 85.405 + 80.67 = $344.5 Mil.
Total Current Assets was $137.2 Mil.
Total Assets was $532.5 Mil.
Property, Plant and Equipment(Net PPE) was $179.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $27.2 Mil.
Selling, General & Admin. Expense(SGA) was $212.8 Mil.
Total Current Liabilities was $43.7 Mil.
Long-Term Debt was $1.4 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)
=(122.356 / 871.151) / (97.56 / 716.539)
=0.14045326 / 0.13615449
=1.0316

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)
=(91.675 / 716.539) / (119.747 / 871.151)
=0.48076936 / 0.47364579
=1.015

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 - (193.342 + 173.197) / 709.36) / (1 - (137.158 + 179.381) / 532.489)
=0.48328211 / 0.40554828
=1.1917

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
=871.151 / 716.539
=1.2158

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))
=(27.186 / (27.186 + 179.381)) / (34.571 / (34.571 + 173.197))
=0.13160863 / 0.16639232
=0.791

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)
=(283.467 / 871.151) / (212.796 / 716.539)
=0.32539365 / 0.29697755
=1.0957

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)
=((56.926 + 116.713) / 709.36) / ((1.415 + 43.671) / 532.489)
=0.24478262 / 0.08467029
=2.891

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
=(50.451 - -0.047 - 71.007) / 709.36
=-0.0289

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.

Forward Air Corp has a M-score of -2.97 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.

Forward Air Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.04971.10660.79281.10710.97151.01950.9740.91051.0411
GMI 0.976600.9871.14381.14120.99231.03191.01790.9846
AQI 1.61991.84711.08480.84370.85890.95770.80291.5381.5629
SGI 1.13731.11331.2080.87981.15941.10841.08961.11641.1969
DEPI 0.97041.50970.79870.89590.95421.00051.02331.02860.8647
SGAI 0.94611.07141.0861.52020.90660.91750.96040.99191.0035
LVGI 1.01972.57641.06841.00470.86970.44630.69780.97551.2068
TATA -0.0481-0.0795-0.055-0.1277-0.0632-0.0875-0.0399-0.072-0.0568
M-score -2.30-3.31-2.78-3.18-2.59-2.60-2.57-2.56-2.40

Forward Air Corp Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 0.97330.93281.02330.91051.03481.07171.00731.04111.07681.0316
GMI 1.02511.0181.00371.01791.02311.00110.99340.97650.98681.015
AQI 1.56141.51851.52721.5381.34861.42291.50051.56291.18531.1917
SGI 1.06441.05441.08621.11641.15891.19341.19311.19691.19461.2158
DEPI 1.04791.09391.0761.02860.97310.91890.88170.86470.80870.791
SGAI 0.91710.89880.87210.99191.0030.99380.99071.00351.04081.0957
LVGI 0.65910.71750.96740.97551.16341.34141.17181.20683.03762.891
TATA -0.0404-0.062-0.0584-0.072-0.0685-0.0674-0.0678-0.0568-0.0328-0.0289
M-score -2.26-2.44-2.40-2.56-2.53-2.51-2.49-2.40-3.02-2.97
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