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Pier 1 Imports, Inc. (NYSE:PIR)
Beneish M-Score
-3.01 (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.

Pier 1 Imports, Inc. has a M-score of -2.72 suggests that the company is not a manipulator.

PIR' s 10-Year Beneish M-Score Range
Min: -4.03   Max: 8.63
Current: -3.01

-4.03
8.63

During the past 13 years, the highest Beneish M-Score of Pier 1 Imports, Inc. was 8.63. The lowest was -4.03. And the median was -2.77.


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 Pier 1 Imports, 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 * 1.0617+0.528 * 1.0357+0.404 * 0.9794+0.892 * 1.0392+0.115 * 1.0171
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9962+4.679 * -0.0639-0.327 * 1.1406
=-2.72

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

This Year (Feb14) TTM:Last Year (Feb13) TTM:
Accounts Receivable was $25 Mil.
Revenue was 515.786 + 465.462 + 395.641 + 394.853 = $1,772 Mil.
Gross Profit was 214.436 + 202.23 + 161.299 + 167.597 = $746 Mil.
Total Current Assets was $577 Mil.
Total Assets was $804 Mil.
Property, Plant and Equipment(Net PPE) was $183 Mil.
Depreciation, Depletion and Amortization(DDA) was $46 Mil.
Selling, General & Admin. Expense(SGA) was $531 Mil.
Total Current Liabilities was $266 Mil.
Long-Term Debt was $10 Mil.
Net Income was 42.592 + 26.758 + 17.834 + 20.347 = $108 Mil.
Non Operating Income was -1.216 + 0.592 + 0.272 + 0 = $-0 Mil.
Cash Flow from Operations was 98.07 + 71.603 + -49.479 + 39.038 = $159 Mil.
Accounts Receivable was $22 Mil.
Revenue was 551.625 + 424.527 + 367.615 + 361.119 = $1,705 Mil.
Gross Profit was 254.978 + 186.259 + 151.549 + 150.275 = $743 Mil.
Total Current Assets was $659 Mil.
Total Assets was $857 Mil.
Property, Plant and Equipment(Net PPE) was $151 Mil.
Depreciation, Depletion and Amortization(DDA) was $38 Mil.
Selling, General & Admin. Expense(SGA) was $513 Mil.
Total Current Liabilities was $248 Mil.
Long-Term Debt was $10 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)
=(24.614 / 1771.742) / (22.309 / 1704.886)
=0.01389254 / 0.01308533
=1.0617

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)
=(202.23 / 1704.886) / (214.436 / 1771.742)
=0.43584204 / 0.42080732
=1.0357

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 - (576.506 + 183.352) / 803.623) / (1 - (658.934 + 150.615) / 857.215)
=0.05445962 / 0.05560565
=0.9794

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
=1771.742 / 1704.886
=1.0392

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))
=(38.431 / (38.431 + 150.615)) / (45.803 / (45.803 + 183.352))
=0.20328915 / 0.19987781
=1.0171

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)
=(531.19 / 1771.742) / (513.084 / 1704.886)
=0.29981228 / 0.30094915
=0.9962

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)
=((9.5 + 265.969) / 803.623) / ((9.5 + 248.127) / 857.215)
=0.34278387 / 0.30053954
=1.1406

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
=(107.531 - -0.352 - 159.232) / 803.623
=-0.0639

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.

Pier 1 Imports, Inc. has a M-score of -2.72 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.

Pier 1 Imports, Inc. Annual Data

Feb05Feb06Feb07Feb08Feb09Feb10Feb11Feb12Feb13Feb14
DSRI 0.79041.79930.75360.69960.61410.7920.96040.9351.23251.0617
GMI 1.09291.13831.15981.00431.05640.80660.85790.93670.97421.0357
AQI 1.1791.15170.57111.11811.06550.92780.69662.33590.65960.9794
SGI 1.01070.97340.91360.93140.87360.97741.08181.09821.11171.0392
DEPI 0.95230.91610.71560.91640.91760.92711.09011.49131.13121.0171
SGAI 1.03381.09961.20760.80711.0640.95020.94791.00180.97130.9962
LVGI 1.01631.41.2651.09461.13890.6250.82990.93630.97081.1406
TATA 0.00780.0202-0.1359-0.0181-0.1524-0.0639-0.06490.03240.0063-0.0643
M-score -2.52-1.70-3.66-2.86-3.67-3.00-2.87-1.72-2.26-2.72

Pier 1 Imports, Inc. Quarterly Data

Nov11Feb12May12Aug12Nov12Feb13May13Aug13Nov13Feb14
DSRI 0.97210.9351.21041.39181.19251.23250.850.91840.94241.0617
GMI 0.92850.93670.94350.94950.96070.97420.97810.98850.99481.0357
AQI 0.94142.33592.30822.12952.08950.65960.56660.5920.64370.9794
SGI 1.08611.09821.0951.09191.09881.11171.11441.11241.10891.0392
DEPI 1.2971.49131.60671.56341.3281.13121.04131.01611.02311.0171
SGAI 0.99751.00181.00120.99130.98690.97130.97150.98030.97830.9962
LVGI 1.00580.93630.94950.88580.880.97081.01810.9521.06691.1406
TATA -0.02310.02930.05710.10750.08940.008-0.0386-0.043-0.0888-0.0639
M-score -2.57-1.73-1.35-1.00-1.30-2.25-2.88-2.81-3.01-2.72
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