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Pep Boys - Manny Moe & Jack (NYSE:PBY)
Beneish M-Score
-2.70 (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.

Pep Boys - Manny Moe & Jack has a M-score of -2.70 suggests that the company is not a manipulator.

PBY' s 10-Year Beneish M-Score Range
Min: -3.05   Max: -1.57
Current: -2.7

-3.05
-1.57

During the past 13 years, the highest Beneish M-Score of Pep Boys - Manny Moe & Jack was -1.57. The lowest was -3.05. 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 Pep Boys - Manny Moe & Jack 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 * 1.0531+0.528 * 1.057+0.404 * 0.8172+0.892 * 1.0091+0.115 * 0.7733
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9999+4.679 * -0.0447-0.327 * 0.9948
=-2.70

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

This Year (Apr15) TTM:Last Year (Apr14) TTM:
Accounts Receivable was $29 Mil.
Revenue was 542.261 + 502.424 + 517.584 + 525.773 = $2,088 Mil.
Gross Profit was 133.767 + 99.684 + 118.334 + 124.297 = $476 Mil.
Total Current Assets was $804 Mil.
Total Assets was $1,521 Mil.
Property, Plant and Equipment(Net PPE) was $598 Mil.
Depreciation, Depletion and Amortization(DDA) was $77 Mil.
Selling, General & Admin. Expense(SGA) was $478 Mil.
Total Current Liabilities was $645 Mil.
Long-Term Debt was $194 Mil.
Net Income was 11.893 + -26.668 + -1.964 + -0.273 = $-17 Mil.
Non Operating Income was 0.372 + 0.013 + 0.418 + 0.316 = $1 Mil.
Cash Flow from Operations was 33.829 + 15.819 + -3.933 + 4.104 = $50 Mil.
Accounts Receivable was $27 Mil.
Revenue was 538.821 + 495.733 + 507.042 + 527.619 = $2,069 Mil.
Gross Profit was 133.126 + 104.016 + 122.812 + 138.708 = $499 Mil.
Total Current Assets was $817 Mil.
Total Assets was $1,593 Mil.
Property, Plant and Equipment(Net PPE) was $623 Mil.
Depreciation, Depletion and Amortization(DDA) was $60 Mil.
Selling, General & Admin. Expense(SGA) was $474 Mil.
Total Current Liabilities was $680 Mil.
Long-Term Debt was $203 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)
=(29.101 / 2088.042) / (27.385 / 2069.215)
=0.01393698 / 0.01323449
=1.0531

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)
=(99.684 / 2069.215) / (133.767 / 2088.042)
=0.24099091 / 0.22800403
=1.057

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 - (803.714 + 597.783) / 1520.728) / (1 - (817.246 + 622.866) / 1592.951)
=0.0784039 / 0.09594708
=0.8172

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
=2088.042 / 2069.215
=1.0091

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))
=(60.147 / (60.147 + 622.866)) / (76.824 / (76.824 + 597.783))
=0.08806128 / 0.11387964
=0.7733

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)
=(477.959 / 2088.042) / (473.72 / 2069.215)
=0.22890296 / 0.22893706
=0.9999

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)
=((193.5 + 644.641) / 1520.728) / ((202.5 + 680.042) / 1592.951)
=0.55114458 / 0.5540296
=0.9948

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
=(-17.012 - 1.119 - 49.819) / 1520.728
=-0.0447

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.

Pep Boys - Manny Moe & Jack has a M-score of -2.70 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.

Pep Boys - Manny Moe & Jack Annual Data

Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15
DSRI 1.20950.79931.04481.08580.80420.8171.2720.91451.06481.2224
GMI 1.18150.9011.10970.9420.94910.96851.06381.05030.99681.034
AQI 0.74852.06610.64171.84440.82161.15921.58080.88631.15880.8419
SGI 0.97191.01580.95290.90160.99131.04071.03771.01310.98841.0087
DEPI 0.96440.87430.9571.03290.99130.94890.93310.95761.12430.8616
SGAI 0.97681.03520.99561.03780.89490.98770.96751.06970.97741.0326
LVGI 1.04011.00650.93470.95010.95171.00841.01590.98861.00921.0114
TATA -0.0043-0.0628-0.07210.0046-0.0443-0.0534-0.0288-0.0751-0.0338-0.0363
M-score -2.35-2.59-2.89-2.14-2.94-2.82-2.07-2.93-2.51-2.51

Pep Boys - Manny Moe & Jack Quarterly Data

Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14Jan15Apr15
DSRI 0.91451.10390.89650.97161.06481.10341.1191.28231.22241.0531
GMI 1.05031.04751.02020.98920.99680.95871.00181.03151.0341.057
AQI 0.88630.92871.0841.06091.15881.17221.19811.07280.84190.8172
SGI 1.01311.01331.01271.01770.98840.98430.98250.98871.00871.0091
DEPI 0.95760.94490.93691.061.12431.24471.35250.96670.86160.7733
SGAI 1.06971.04081.05351.04930.97741.00340.99080.98371.03260.9999
LVGI 0.98860.96680.97991.0141.00921.00821.01551.01071.01140.9948
TATA -0.0751-0.0558-0.0291-0.0259-0.0338-0.0368-0.0294-0.0087-0.0363-0.0447
M-score -2.93-2.64-2.67-2.60-2.51-2.50-2.41-2.23-2.51-2.70
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