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Pier 1 Imports Inc (NYSE:PIR)
Beneish M-Score
-2.49 (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 -2.49 suggests that the company is not a manipulator.

PIR' s 10-Year Beneish M-Score Range
Min: -3.61   Max: -1.33
Current: -2.49

-3.61
-1.33

During the past 13 years, the highest Beneish M-Score of Pier 1 Imports Inc was -1.33. The lowest was -3.61. And the median was -2.54.


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 * 1.1344+0.528 * 1.0473+0.404 * 0.8472+0.892 * 1.0531+0.115 * 0.9878
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0299+4.679 * 0.0104-0.327 * 1.5819
=-2.49

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

This Year (Feb15) TTM:Last Year (Feb14) TTM:
Accounts Receivable was $29 Mil.
Revenue was 543.6 + 484.501 + 418.622 + 419.059 = $1,866 Mil.
Gross Profit was 214.442 + 204.913 + 162.637 + 167.714 = $750 Mil.
Total Current Assets was $654 Mil.
Total Assets was $910 Mil.
Property, Plant and Equipment(Net PPE) was $214 Mil.
Depreciation, Depletion and Amortization(DDA) was $54 Mil.
Selling, General & Admin. Expense(SGA) was $576 Mil.
Total Current Liabilities was $289 Mil.
Long-Term Debt was $205 Mil.
Net Income was 33.089 + 17.86 + 9.158 + 15.055 = $75 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 111.9 + 24.36 + -97.702 + 27.133 = $66 Mil.
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.



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)
=(29.405 / 1865.782) / (24.614 / 1771.742)
=0.01576015 / 0.01389254
=1.1344

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)
=(204.913 / 1771.742) / (214.442 / 1865.782)
=0.42080732 / 0.40181865
=1.0473

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 - (654.163 + 214.048) / 910.204) / (1 - (576.506 + 183.352) / 803.623)
=0.04613581 / 0.05445962
=0.8472

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
=1865.782 / 1771.742
=1.0531

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))
=(45.803 / (45.803 + 183.352)) / (54.299 / (54.299 + 214.048))
=0.19987781 / 0.20234622
=0.9878

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)
=(576.131 / 1865.782) / (531.19 / 1771.742)
=0.30878795 / 0.29981228
=1.0299

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)
=((204.746 + 288.813) / 910.204) / ((9.5 + 265.969) / 803.623)
=0.54225097 / 0.34278387
=1.5819

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
=(75.162 - 0 - 65.691) / 910.204
=0.0104

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 -2.49 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

Feb06Feb07Feb08Feb09Feb10Feb11Feb12Feb13Feb14Feb15
DSRI 1.28931.68611.1580.86970.85620.93151.00081.23251.06171.1344
GMI 1.13831.15981.00431.05640.80660.85790.93670.97421.03571.0473
AQI 1.15170.57111.11811.06550.92780.69662.33590.65960.97940.8472
SGI 0.97340.91360.93140.87360.97741.08181.09821.11171.03921.0531
DEPI 0.91610.71560.91640.91760.92711.09011.49131.13121.01710.9878
SGAI 1.09961.20760.80711.0640.95020.94791.00180.97130.99621.0299
LVGI 1.41.2651.09461.13890.6250.82990.93630.97081.14061.5819
TATA 0.0202-0.1359-0.0181-0.1524-0.0639-0.06980.03240.0063-0.06650.0104
M-score -2.17-2.81-2.44-3.44-2.94-2.92-1.66-2.26-2.73-2.49

Pier 1 Imports Inc Quarterly Data

Nov12Feb13May13Aug13Nov13Feb14May14Aug14Nov14Feb15
DSRI 1.19851.23250.850.91840.94241.06171.03471.07281.21071.1344
GMI 0.96070.97420.97810.98850.99481.03571.05331.06151.06621.0473
AQI 2.08950.65960.56660.5920.64370.97940.95660.97080.86840.8472
SGI 1.09881.11171.11441.11241.10891.03921.0331.02961.01681.0531
DEPI 1.3281.13121.04131.01611.02311.01711.03511.02831.01330.9878
SGAI 0.98690.97130.97150.98030.97830.99620.99581.00151.01651.0299
LVGI 0.880.97081.01810.9521.06691.14061.69011.71861.64931.5819
TATA 0.08970.0058-0.0407-0.0452-0.0913-0.066-0.0491-0.00750.03510.0104
M-score -1.29-2.26-2.89-2.82-3.03-2.73-2.86-2.63-2.34-2.49
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