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The zones of discrimination for M-Score is as such:
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
Good Sign:
Beneish M-Score -3.17 no higher than -1.78, which implies that the company is unlikely to be a manipulator.
The historical rank and industry rank for MercadoLibre's Beneish M-Score or its related term are showing as below:
During the past 13 years, the highest Beneish M-Score of MercadoLibre was -1.79. The lowest was -3.17. And the median was -2.69.
The historical data trend for MercadoLibre's Beneish M-Score can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Internet Retail subindustry, MercadoLibre's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
For the Retail - Cyclical industry and Consumer Cyclical sector, MercadoLibre's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where MercadoLibre's Beneish M-Score falls into.
The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 MercadoLibre 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 * 0.9622 | + | 0.528 * 0.9841 | + | 0.404 * 0.8258 | + | 0.892 * 1.3735 | + | 0.115 * 1.0018 | |
- | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI | |||||||
- | 0.172 * 0.9313 | + | 4.679 * -0.200499 | - | 0.327 * 0.9426 | |||||||
= | -3.17 |
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
This Year (Dec23) TTM: | Last Year (Dec22) TTM: |
Total Receivables was $6,575 Mil. Revenue was 4261 + 3760 + 3415 + 3037 = $14,473 Mil. Gross Profit was 1955 + 1995 + 1720 + 1536 = $7,206 Mil. Total Current Assets was $14,294 Mil. Total Assets was $17,646 Mil. Property, Plant and Equipment(Net PPE) was $2,149 Mil. Depreciation, Depletion and Amortization(DDA) was $524 Mil. Selling, General, & Admin. Expense(SGA) was $2,502 Mil. Total Current Liabilities was $11,297 Mil. Long-Term Debt & Capital Lease Obligation was $2,875 Mil. Net Income was 165 + 359 + 262 + 201 = $987 Mil. Non Operating Income was -107 + -239 + -182 + -87 = $-615 Mil. Cash Flow from Operations was 1928 + 941 + 1412 + 859 = $5,140 Mil. |
Total Receivables was $4,975 Mil. Revenue was 3002 + 2690 + 2597 + 2248 = $10,537 Mil. Gross Profit was 1458 + 1348 + 1284 + 1073 = $5,163 Mil. Total Current Assets was $10,953 Mil. Total Assets was $13,736 Mil. Property, Plant and Equipment(Net PPE) was $1,649 Mil. Depreciation, Depletion and Amortization(DDA) was $403 Mil. Selling, General, & Admin. Expense(SGA) was $1,956 Mil. Total Current Liabilities was $8,562 Mil. Long-Term Debt & Capital Lease Obligation was $3,141 Mil. |
1. DSRI = Days Sales in Receivables Index
Measured as the ratio of Revenue in Total 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) |
= | (6575 / 14473) | / | (4975 / 10537) | |
= | 0.454294 | / | 0.472146 | |
= | 0.9622 |
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) | |
= | (5163 / 10537) | / | (7206 / 14473) | |
= | 0.489988 | / | 0.497893 | |
= | 0.9841 |
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 Property, Plant and Equipment to Total Assets.
AQI | = | (1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) | / | (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1) |
= | (1 - (14294 + 2149) / 17646) | / | (1 - (10953 + 1649) / 13736) | |
= | 0.068174 | / | 0.082557 | |
= | 0.8258 |
4. SGI = Sales Growth Index
Ratio of Revenue 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 | |
= | 14473 | / | 10537 | |
= | 1.3735 |
5. DEPI = Depreciation Index
Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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)) |
= | (403 / (403 + 1649)) | / | (524 / (524 + 2149)) | |
= | 0.196394 | / | 0.196034 | |
= | 1.0018 |
Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.
6. SGAI = Sales, General and Administrative expenses Index
The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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) |
= | (2502 / 14473) | / | (1956 / 10537) | |
= | 0.172874 | / | 0.185632 | |
= | 0.9313 |
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 in leverage
LVGI | = | ((LTD_t + CurrentLiabilities_t) / TotalAssets_t) | / | ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1) |
= | ((2875 + 11297) / 17646) | / | ((3141 + 8562) / 13736) | |
= | 0.803128 | / | 0.851995 | |
= | 0.9426 |
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 | |
= | (987 - -615 | - | 5140) | / | 17646 | |
= | -0.200499 |
An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.
MercadoLibre has a M-score of -3.17 suggests that the company is unlikely to be a manipulator.
Thank you for viewing the detailed overview of MercadoLibre's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.
De La Serna Juan Martin | officer: Executive VP Corporate Affairs | AV. PTE. PERON 2375, LOTE MN04, PILAR, BUENOS AIRES C1 1629 |
Emiliano Calemzuk | director | C/O MERCADOLIBRE, INC., TRONADOR 4890, 8TH FLOOR, BUENOS AIRES C1 C1430DNN |
Petroni Merhy Andrea Mayumi | director | HOUSE B, 32 STANLEY VILLAGE ROAD, STANLEY K3 000000 |
Marcelo Melamud | officer: V. P. Chief Accounting Officer | TRONADOR 4890, 8TH FLOOR, BUENOS AIRES C1 C1430DNN |
Richard A Sanders | director | 80 PALL MALL, LONDON X0 SW1Y 5ES |
Ariel Szarfsztejn | officer: Executive VP - Commerce | POSTA 4789, 6TH FLOOR, BUENOS AIRES C1 C1430CRG |
Henrique Vasoncelos Dubugras | director | 1000 LAUREL WAY, BEVERLY HILLS CA 90210 |
Alejandro Nicolas Aguzin | director | ARIAS 3751, 7TH FLOOR, BUENOS AIRES C1 C1430DNN |
Meyer Malka | director | 364 UNIVERSITY AVENUE, PALO ALTO CA 94301 |
Roberto Balls Sallouti | director | ARIAS 3751, 7TH FLOOR, BUENOS AIRES C1 C1 C1430CRG |
Stelleo Tolda | officer: Country Manager Brazil | C/O MERCADOLIBRE, INC., TRONADOR 4890, 8TH FLOOR, BUENOS AIRES C1 C1430DNN |
Ebay Inc | 10 percent owner | 2025 HAMILTON AVENUE, SAN JOSE CA 95125 |
Daniel Rabinovich | officer: VP-Chief Technology Officer | ARIAS 3751, 7TH FLOOR, BUENOS AIRES C1 C1430CRG |
A Michael Spence | director | 121 INNOVATION DR STE 200, IRVINE CA 92612 |
Pedro Arnt | officer: Executive VP and CFO | ARIAS 3751, 7TH FLOOR, BUENOS AIRES C1 C1430CRG |
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