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Forward Air Corp (NAS:FWRD)
Beneish M-Score
-2.40 (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 -2.40 suggests that the company is not a manipulator.

FWRD' s 10-Year Beneish M-Score Range
Min: -3.18   Max: 47.03
Current: -2.4

-3.18
47.03

During the past 13 years, the highest Beneish M-Score of Forward Air Corp was 47.03. The lowest was -3.18. And the median was -2.61.


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 * 1.0411+0.528 * 0.9846+0.404 * 1.5629+0.892 * 1.1969+0.115 * 0.8647
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0035+4.679 * -0.0568-0.327 * 1.2068
=-2.40

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $95.3 Mil.
Revenue was 214.062 + 201.477 + 193.852 + 171.569 = $781.0 Mil.
Gross Profit was 102.854 + 98.341 + 94.577 + 80.734 = $376.5 Mil.
Total Current Assets was $150.0 Mil.
Total Assets was $541.8 Mil.
Property, Plant and Equipment(Net PPE) was $172.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $31.1 Mil.
Selling, General & Admin. Expense(SGA) was $231.8 Mil.
Total Current Liabilities was $43.4 Mil.
Long-Term Debt was $1.3 Mil.
Net Income was 17.046 + 16.744 + 17.178 + 10.202 = $61.2 Mil.
Non Operating Income was 0.145 + -0.055 + 0.112 + 0.086 = $0.3 Mil.
Cash Flow from Operations was 26.567 + 25.878 + 19.183 + 20.032 = $91.7 Mil.
Accounts Receivable was $76.5 Mil.
Revenue was 181.085 + 170.033 + 159.804 + 141.56 = $652.5 Mil.
Gross Profit was 85.405 + 80.67 + 75.792 + 67.849 = $309.7 Mil.
Total Current Assets was $220.4 Mil.
Total Assets was $506.3 Mil.
Property, Plant and Equipment(Net PPE) was $154.8 Mil.
Depreciation, Depletion and Amortization(DDA) was $23.6 Mil.
Selling, General & Admin. Expense(SGA) was $193.0 Mil.
Total Current Liabilities was $34.6 Mil.
Long-Term Debt was $0.0 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)
=(95.326 / 780.96) / (76.5 / 652.482)
=0.12206259 / 0.11724461
=1.0411

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)
=(98.341 / 652.482) / (102.854 / 780.96)
=0.47467363 / 0.48210664
=0.9846

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 - (149.955 + 172.489) / 541.805) / (1 - (220.36 + 154.763) / 506.269)
=0.40487076 / 0.25904411
=1.5629

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
=780.96 / 652.482
=1.1969

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))
=(23.579 / (23.579 + 154.763)) / (31.133 / (31.133 + 172.489))
=0.13221227 / 0.15289605
=0.8647

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)
=(231.835 / 780.96) / (193.026 / 652.482)
=0.29685899 / 0.29583345
=1.0035

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)
=((1.275 + 43.431) / 541.805) / ((0.003 + 34.611) / 506.269)
=0.08251308 / 0.06837077
=1.2068

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
=(61.17 - 0.288 - 91.66) / 541.805
=-0.0568

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 -2.40 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

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 0.97230.9740.97330.93281.02330.91051.03481.07171.00731.0411
GMI 0.96941.06611.02511.0181.00371.01791.02311.01021.0020.9846
AQI 0.91210.80291.56141.51851.52721.5381.34861.42291.50051.5629
SGI 1.10691.08961.06441.05441.08621.11641.15891.19341.19311.1969
DEPI 1.01031.02331.04791.09391.0761.02860.97310.91890.88170.8647
SGAI 1.21490.91180.91710.89880.87210.99191.0030.99380.99071.0035
LVGI 0.34580.69780.65910.71750.96740.97551.16341.34141.17181.2068
TATA -0.0431-0.0399-0.0404-0.062-0.0584-0.072-0.0685-0.0674-0.0678-0.0568
M-score -2.49-2.54-2.26-2.44-2.40-2.56-2.53-2.50-2.48-2.40
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