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Forward Air Corp (NAS:FWRD)
Beneish M-Score
-3.10 (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 -3.10 suggests that the company is not a manipulator.

FWRD' s Beneish M-Score Range Over the Past 10 Years
Min: -3.56   Max: 47.03
Current: -3.1

-3.56
47.03

During the past 13 years, the highest Beneish M-Score of Forward Air Corp was 47.03. The lowest was -3.56. And the median was -2.62.


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 * 0.9464+0.528 * 0.8516+0.404 * 0.9607+0.892 * 1.0626+0.115 * 1.0661
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.2514+4.679 * -0.1321-0.327 * 0.6425
=-3.10

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $115.3 Mil.
Revenue was 249.552 + 238.637 + 229.549 + 256.42 = $974.2 Mil.
Gross Profit was 117.712 + 136.371 + 110.849 + 212.671 = $577.6 Mil.
Total Current Assets was $144.0 Mil.
Total Assets was $641.5 Mil.
Property, Plant and Equipment(Net PPE) was $197.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $38.0 Mil.
Selling, General & Admin. Expense(SGA) was $350.7 Mil.
Total Current Liabilities was $91.1 Mil.
Long-Term Debt was $0.8 Mil.
Net Income was 11.931 + -10.066 + 13.099 + 23.228 = $38.2 Mil.
Non Operating Income was -0.004 + -0.117 + -0.029 + 0.069 = $-0.1 Mil.
Cash Flow from Operations was 33.402 + 23.765 + 37.441 + 28.407 = $123.0 Mil.
Accounts Receivable was $114.7 Mil.
Revenue was 247.093 + 249.694 + 205.918 + 214.062 = $916.8 Mil.
Gross Profit was 116.6 + 138.024 + 91.675 + 116.587 = $462.9 Mil.
Total Current Assets was $185.7 Mil.
Total Assets was $698.7 Mil.
Property, Plant and Equipment(Net PPE) was $172.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $35.9 Mil.
Selling, General & Admin. Expense(SGA) was $263.7 Mil.
Total Current Liabilities was $113.0 Mil.
Long-Term Debt was $42.8 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)
=(115.327 / 974.158) / (114.674 / 916.767)
=0.11838634 / 0.12508522
=0.9464

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)
=(462.886 / 916.767) / (577.603 / 974.158)
=0.50491128 / 0.59292538
=0.8516

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 - (143.96 + 197.234) / 641.513) / (1 - (185.697 + 172.501) / 698.665)
=0.46814172 / 0.4873108
=0.9607

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
=974.158 / 916.767
=1.0626

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))
=(35.855 / (35.855 + 172.501)) / (37.965 / (37.965 + 197.234))
=0.17208528 / 0.1614165
=1.0661

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)
=(350.65 / 974.158) / (263.705 / 916.767)
=0.35995188 / 0.2876467
=1.2514

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)
=((0.814 + 91.124) / 641.513) / ((42.83 + 113.024) / 698.665)
=0.14331432 / 0.22307401
=0.6425

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
=(38.192 - -0.081 - 123.015) / 641.513
=-0.1321

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 -3.10 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 local exchange's currency.

Forward Air Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.96391.10660.79281.10710.97151.01950.9740.91051.04110.9324
GMI 1.00010.70620.9871.35690.84031.00151.02751.02130.98750.9795
AQI 1.11971.84711.08480.84370.85890.95770.80291.5381.57021.1914
SGI 1.09921.11331.2080.87981.15941.10841.08961.11641.19691.2281
DEPI 1.10991.50970.79870.89590.95421.00051.02331.02860.86470.9236
SGAI 0.86291.07141.0861.15911.18910.91750.96040.99191.00351.1532
LVGI 0.74212.57641.06841.00470.86970.44630.69780.97551.21242.3726
TATA -0.0318-0.0795-0.055-0.1277-0.0632-0.0875-0.0399-0.072-0.0571-0.043
M-score -2.40-2.93-2.78-3.00-2.80-2.60-2.57-2.55-2.40-2.96

Forward Air Corp Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 1.07171.00731.04111.07681.03160.93550.93250.71840.80050.9464
GMI 1.01431.00280.98751.03321.03051.07740.93650.88550.8840.8516
AQI 1.42291.50051.57021.18531.19171.20231.19141.01490.93930.9607
SGI 1.19341.19311.19691.19461.21581.22571.22811.20541.11541.0626
DEPI 0.91890.88170.86470.80870.7910.8220.92360.92530.99151.0661
SGAI 0.99380.99071.00350.95471.0150.97241.23941.27981.19331.2514
LVGI 1.34141.17181.21243.03762.8912.5492.37260.67110.64440.6425
TATA -0.0674-0.0678-0.0571-0.0328-0.0289-0.0494-0.043-0.0752-0.134-0.1321
M-score -2.50-2.48-2.40-2.98-2.95-2.97-2.99-2.91-3.19-3.10
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