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Henry Schein Inc (NAS:HSIC)
Beneish M-Score
-2.53 (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 -2.53 suggests that the company is not a manipulator.

HSIC' s 10-Year Beneish M-Score Range
Min: -2.91   Max: -1.71
Current: -2.53

-2.91
-1.71

During the past 13 years, the highest Beneish M-Score of Henry Schein Inc was -1.71. The lowest was -2.91. And the median was -2.43.


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 * 0.985+0.528 * 0.9897+0.404 * 1.062+0.892 * 1.0848+0.115 * 0.9656
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.023+4.679 * -0.0213-0.327 * 1.0637
=-2.53

* 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 $1,128 Mil.
Revenue was 2702.096 + 2623.729 + 2615.406 + 2430.159 = $10,371 Mil.
Gross Profit was 764.464 + 721.666 + 728.472 + 696.713 = $2,911 Mil.
Total Current Assets was $2,913 Mil.
Total Assets was $6,139 Mil.
Property, Plant and Equipment(Net PPE) was $311 Mil.
Depreciation, Depletion and Amortization(DDA) was $152 Mil.
Selling, General & Admin. Expense(SGA) was $2,196 Mil.
Total Current Liabilities was $1,780 Mil.
Long-Term Debt was $543 Mil.
Net Income was 132.966 + 114.776 + 116.236 + 102.099 = $466 Mil.
Non Operating Income was 0.444 + -0.484 + 1.032 + 3.58 = $5 Mil.
Cash Flow from Operations was 274.019 + 174.502 + 199.232 + -55.249 = $593 Mil.
Accounts Receivable was $1,055 Mil.
Revenue was 2526.37 + 2348.956 + 2391.81 + 2293.511 = $9,561 Mil.
Gross Profit was 699.52 + 639.647 + 669.856 + 646.991 = $2,656 Mil.
Total Current Assets was $2,835 Mil.
Total Assets was $5,625 Mil.
Property, Plant and Equipment(Net PPE) was $276 Mil.
Depreciation, Depletion and Amortization(DDA) was $128 Mil.
Selling, General & Admin. Expense(SGA) was $1,979 Mil.
Total Current Liabilities was $1,551 Mil.
Long-Term Debt was $450 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)
=(1127.517 / 10371.39) / (1055.216 / 9560.647)
=0.10871416 / 0.11037077
=0.985

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)
=(721.666 / 9560.647) / (764.464 / 10371.39)
=0.27780693 / 0.28070635
=0.9897

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 - (2913.166 + 311.496) / 6138.807) / (1 - (2834.665 + 275.888) / 5624.636)
=0.47470869 / 0.44697701
=1.062

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
=10371.39 / 9560.647
=1.0848

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))
=(128.035 / (128.035 + 275.888)) / (152.238 / (152.238 + 311.496))
=0.31697873 / 0.32828734
=0.9656

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)
=(2196.173 / 10371.39) / (1978.96 / 9560.647)
=0.21175301 / 0.20699018
=1.023

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)
=((542.776 + 1780.111) / 6138.807) / ((450.233 + 1550.663) / 5624.636)
=0.37839388 / 0.35573786
=1.0637

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
=(466.077 - 4.572 - 592.504) / 6138.807
=-0.0213

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 -2.53 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.90480.93870.99270.9590.96441.06070.88481.09050.97190.985
GMI 0.93560.99141.00290.98971.0021.01651.01751.01061.00960.9897
AQI 0.92071.12211.04670.9721.00221.3060.99540.94941.01191.062
SGI 1.1611.11541.16961.08061.02481.15121.13331.0481.06941.0848
DEPI 0.9391.07330.9740.95921.00310.83520.9330.97570.99140.9656
SGAI 1.04491.0010.97270.99720.98810.98120.98930.97360.98781.023
LVGI 0.93750.93520.93670.97230.85970.99941.00341.06570.96771.0637
TATA -0.0455-0.0258-0.018-0.0388-0.0229-0.0154-0.0399-0.0043-0.0418-0.0213
M-score -2.70-2.48-2.38-2.64-2.55-2.24-2.65-2.41-2.62-2.53

Henry Schein Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 0.97521.09051.02061.00391.0010.97191.02291.07390.98990.985
GMI 1.01241.01061.01861.01831.01421.00960.99810.99660.99390.9897
AQI 0.99030.94940.98290.97210.98361.01191.02061.02891.04991.062
SGI 1.08011.0481.05221.06541.06441.06941.06161.06391.07971.0848
DEPI 0.93250.97570.95710.95830.97650.99141.03331.04351.01520.9656
SGAI 0.97840.97360.97160.97060.97350.98781.00331.01311.02061.023
LVGI 1.1251.06571.05840.95980.9030.96771.03511.08161.14441.0637
TATA -0.0213-0.0043-0.0042-0.0207-0.0323-0.0418-0.0359-0.0215-0.0231-0.0213
M-score -2.57-2.41-2.45-2.50-2.54-2.62-2.57-2.47-2.56-2.53
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