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GuruFocus has detected 2 Warning Signs with JB Hunt Transport Services Inc $JBHT.
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JB Hunt Transport Services Inc (NAS:JBHT)
Beneish M-Score
-2.89 (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.

JB Hunt Transport Services Inc has a M-score of -2.89 suggests that the company is not a manipulator.

JBHT' s Beneish M-Score Range Over the Past 10 Years
Min: -5.15   Max: -1.91
Current: -2.89

-5.15
-1.91

During the past 13 years, the highest Beneish M-Score of JB Hunt Transport Services Inc was -1.91. The lowest was -5.15. And the median was -2.84.


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 JB Hunt Transport Services 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 * 1.1268+0.528 * 1.027+0.404 * 0.87+0.892 * 1.0594+0.115 * 0.9825
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0016+4.679 * -0.1169-0.327 * 0.9659
=-2.89

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

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $745 Mil.
Revenue was 1721.062 + 1690.659 + 1615.026 + 1528.712 = $6,555 Mil.
Gross Profit was 1033.674 + 669.52 + 656.836 + 640.586 = $3,001 Mil.
Total Current Assets was $946 Mil.
Total Assets was $3,829 Mil.
Property, Plant and Equipment(Net PPE) was $2,819 Mil.
Depreciation, Depletion and Amortization(DDA) was $362 Mil.
Selling, General & Admin. Expense(SGA) was $1,635 Mil.
Total Current Liabilities was $573 Mil.
Long-Term Debt was $986 Mil.
Net Income was 117.556 + 109.425 + 105.011 + 100.098 = $432 Mil.
Non Operating Income was 38.694 + -12.97 + 0 + 0 = $26 Mil.
Cash Flow from Operations was 170.18 + 209.825 + 169.242 + 304.896 = $854 Mil.
Accounts Receivable was $624 Mil.
Revenue was 1621.015 + 1586.494 + 1539.957 + 1440.18 = $6,188 Mil.
Gross Profit was 1047.842 + 646.564 + 633.343 + 581.041 = $2,909 Mil.
Total Current Assets was $858 Mil.
Total Assets was $3,630 Mil.
Property, Plant and Equipment(Net PPE) was $2,701 Mil.
Depreciation, Depletion and Amortization(DDA) was $340 Mil.
Selling, General & Admin. Expense(SGA) was $1,540 Mil.
Total Current Liabilities was $532 Mil.
Long-Term Debt was $998 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)
=(745.288 / 6555.459) / (624.294 / 6187.646)
=0.11368967 / 0.10089362
=1.1268

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)
=(2908.79 / 6187.646) / (3000.616 / 6555.459)
=0.47009638 / 0.45772783
=1.027

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 - (945.681 + 2818.791) / 3828.988) / (1 - (857.925 + 2701.329) / 3629.544)
=0.01684936 / 0.01936607
=0.87

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
=6555.459 / 6187.646
=1.0594

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))
=(339.613 / (339.613 + 2701.329)) / (361.51 / (361.51 + 2818.791))
=0.1116802 / 0.11367163
=0.9825

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)
=(1634.649 / 6555.459) / (1540.448 / 6187.646)
=0.24935691 / 0.24895542
=1.0016

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)
=((986.278 + 573.134) / 3828.988) / ((998.003 + 532.417) / 3629.544)
=0.40726479 / 0.42165627
=0.9659

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
=(432.09 - 25.724 - 854.143) / 3828.988
=-0.1169

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.

JB Hunt Transport Services Inc has a M-score of -2.89 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.

JB Hunt Transport Services Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.90940.79471.28840.95560.98191.01421.10431.04170.95151.1268
GMI 0.93261.11520.98081.13491.05461.0341.00070.79340.96681.027
AQI 0.94190.73021.7960.93481.19250.84190.9581.06511.89890.87
SGI 1.04871.06940.85841.18421.19331.11671.10481.1041.00361.0594
DEPI 0.9541.03031.10030.98451.06631.01721.01181.010.94960.9825
SGAI 8.71560.89831.09380.92660.91120.9251.00631.08821.07941.0016
LVGI 1.72980.79640.8731.0941.02090.87980.94051.03690.97930.9659
TATA -0.1307-0.1688-0.1206-0.1165-0.167-0.0964-0.0823-0.0805-0.1229-0.1102
M-score -4.76-3.36-2.56-2.88-2.98-2.81-2.67-2.83-2.76-2.86

JB Hunt Transport Services Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 1.0371.04170.91380.9440.97650.95151.08031.09021.10441.1268
GMI 0.97140.79650.77780.77320.77480.96310.97961.00051.02361.027
AQI 1.14851.06511.7571.80982.00181.89891.19971.34280.92320.87
SGI 1.10681.1041.08751.05561.02421.00361.01251.02591.04521.0594
DEPI 1.01961.010.9760.96750.96290.94960.95550.95620.97170.9825
SGAI 1.06241.081.08361.07681.05881.08751.08281.06431.06191.0016
LVGI 1.04871.03690.89290.90691.00190.97931.04271.00270.94790.9659
TATA -0.0928-0.0805-0.1007-0.1123-0.1196-0.1303-0.1409-0.1308-0.1229-0.1169
M-score -2.76-2.83-2.75-2.79-2.77-2.80-3.02-2.86-2.93-2.89
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