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Henry Schein Inc (NAS:HSIC)
Beneish M-Score
-2.56 (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.

Henry Schein Inc has a M-score of -2.56 suggests that the company is not a manipulator.

HSIC' s 10-Year Beneish M-Score Range
Min: -2.91   Max: -1.38
Current: -2.56

-2.91
-1.38

During the past 13 years, the highest Beneish M-Score of Henry Schein Inc was -1.38. The lowest was -2.91. And the median was -2.48.


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 Henry Schein 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 * 0.9899+0.528 * 0.9939+0.404 * 1.0499+0.892 * 1.0797+0.115 * 1.0152
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0206+4.679 * -0.0231-0.327 * 1.1444
=-2.56

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

This Year (Sep14) TTM:Last Year (Sep13) TTM:
Accounts Receivable was $1,179 Mil.
Revenue was 2623.729 + 2615.406 + 2430.159 + 2526.37 = $10,196 Mil.
Gross Profit was 721.666 + 728.472 + 696.713 + 699.52 = $2,846 Mil.
Total Current Assets was $2,928 Mil.
Total Assets was $6,131 Mil.
Property, Plant and Equipment(Net PPE) was $303 Mil.
Depreciation, Depletion and Amortization(DDA) was $145 Mil.
Selling, General & Admin. Expense(SGA) was $2,147 Mil.
Total Current Liabilities was $1,706 Mil.
Long-Term Debt was $631 Mil.
Net Income was 114.776 + 116.236 + 102.099 + 124.268 = $457 Mil.
Non Operating Income was -0.484 + 1.032 + 3.58 + 1.466 = $6 Mil.
Cash Flow from Operations was 174.502 + 199.232 + -55.249 + 274.628 = $593 Mil.
Accounts Receivable was $1,103 Mil.
Revenue was 2348.956 + 2391.81 + 2293.511 + 2408.438 = $9,443 Mil.
Gross Profit was 639.647 + 669.856 + 646.991 + 663.495 = $2,620 Mil.
Total Current Assets was $2,635 Mil.
Total Assets was $5,278 Mil.
Property, Plant and Equipment(Net PPE) was $265 Mil.
Depreciation, Depletion and Amortization(DDA) was $129 Mil.
Selling, General & Admin. Expense(SGA) was $1,948 Mil.
Total Current Liabilities was $1,446 Mil.
Long-Term Debt was $311 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)
=(1179.171 / 10195.664) / (1103.272 / 9442.715)
=0.11565416 / 0.11683843
=0.9899

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)
=(728.472 / 9442.715) / (721.666 / 10195.664)
=0.27746141 / 0.27917466
=0.9939

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 - (2928.237 + 303.157) / 6130.631) / (1 - (2635.42 + 265.273) / 5278.089)
=0.47291005 / 0.45042742
=1.0499

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
=10195.664 / 9442.715
=1.0797

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))
=(129.414 / (129.414 + 265.273)) / (144.622 / (144.622 + 303.157))
=0.3278902 / 0.32297629
=1.0152

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)
=(2147.288 / 10195.664) / (1948.476 / 9442.715)
=0.21060796 / 0.20634701
=1.0206

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)
=((630.806 + 1705.834) / 6130.631) / ((311.458 + 1446.445) / 5278.089)
=0.38114184 / 0.33305672
=1.1444

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
=(457.379 - 5.594 - 593.113) / 6130.631
=-0.0231

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.

Henry Schein Inc has a M-score of -2.56 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.

Henry Schein Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.97290.90480.93870.99270.9590.96441.06070.88481.09050.9719
GMI 1.05120.93560.99141.00290.98971.0021.01651.01751.01061.0096
AQI 1.21510.92071.12211.04670.9721.00221.3060.99540.94941.0119
SGI 1.22061.1611.11541.16961.08061.02481.15121.13331.0481.0694
DEPI 0.85450.9391.07330.9740.95921.00310.83520.9330.97570.9914
SGAI 1.04531.04491.0010.97270.99720.98810.98120.98930.97360.9878
LVGI 1.18980.93750.93520.93670.97230.85970.99941.00341.06570.9677
TATA -0.0279-0.0455-0.0258-0.018-0.0388-0.0229-0.0154-0.0399-0.0043-0.0418
M-score -2.41-2.70-2.48-2.38-2.64-2.55-2.24-2.65-2.41-2.62

Henry Schein Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
DSRI 0.92230.97521.09051.02061.00391.0010.97191.02291.07390.9899
GMI 1.01291.01241.01061.01861.01831.01421.00960.99810.99660.9939
AQI 1.00270.99030.94940.98290.97210.98361.01191.02061.02891.0499
SGI 1.09471.08011.0481.05221.06541.06441.06941.06161.06391.0797
DEPI 0.89750.93250.97570.95710.95830.97650.99141.03331.04351.0152
SGAI 0.98190.97840.97360.97160.97060.97350.98781.00331.01311.0206
LVGI 1.07781.1251.06571.05840.95980.9030.96771.03511.08161.1444
TATA -0.0258-0.0213-0.0043-0.0042-0.0207-0.0323-0.0418-0.0359-0.0215-0.0231
M-score -2.61-2.57-2.41-2.45-2.50-2.54-2.62-2.57-2.47-2.56
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