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Regis Corp (NYSE:RGS)
Beneish M-Score
-3.36 (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.

Regis Corp has a M-score of -3.36 suggests that the company is not a manipulator.

RGS' s 10-Year Beneish M-Score Range
Min: -4.06   Max: -1.01
Current: -3.36

-4.06
-1.01

During the past 13 years, the highest Beneish M-Score of Regis Corp was -1.01. The lowest was -4.06. 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 Regis Corp 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 * 0.6368+0.528 * 1.0008+0.404 * 1.1315+0.892 * 0.9649+0.115 * 0.9766
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0004+4.679 * -0.1348-0.327 * 0.8133
=-3.36

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $27 Mil.
Revenue was 455.887 + 464.551 + 483.926 + 471.561 = $1,876 Mil.
Gross Profit was 187.838 + 195.887 + 204.831 + 199.071 = $788 Mil.
Total Current Assets was $427 Mil.
Total Assets was $1,190 Mil.
Property, Plant and Equipment(Net PPE) was $241 Mil.
Depreciation, Depletion and Amortization(DDA) was $74 Mil.
Selling, General & Admin. Expense(SGA) was $698 Mil.
Total Current Liabilities was $211 Mil.
Long-Term Debt was $120 Mil.
Net Income was -19.071 + -9.052 + -17.022 + -9.484 = $-55 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 21.596 + 16.033 + 33.689 + 34.485 = $106 Mil.
Accounts Receivable was $44 Mil.
Revenue was 468.367 + 468.583 + 502.251 + 504.937 = $1,944 Mil.
Gross Profit was 194.493 + 199.544 + 205.573 + 217.34 = $817 Mil.
Total Current Assets was $589 Mil.
Total Assets was $1,434 Mil.
Property, Plant and Equipment(Net PPE) was $290 Mil.
Depreciation, Depletion and Amortization(DDA) was $86 Mil.
Selling, General & Admin. Expense(SGA) was $723 Mil.
Total Current Liabilities was $370 Mil.
Long-Term Debt was $120 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)
=(27.253 / 1875.925) / (44.352 / 1944.138)
=0.01452777 / 0.0228132
=0.6368

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)
=(195.887 / 1944.138) / (187.838 / 1875.925)
=0.42021194 / 0.4198606
=1.0008

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 - (427.491 + 241.493) / 1190.436) / (1 - (588.528 + 290.378) / 1434.066)
=0.43803447 / 0.38712305
=1.1315

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
=1875.925 / 1944.138
=0.9649

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))
=(86.407 / (86.407 + 290.378)) / (74.106 / (74.106 + 241.493))
=0.22932707 / 0.23481063
=0.9766

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)
=(698.176 / 1875.925) / (723.285 / 1944.138)
=0.37217693 / 0.37203378
=1.0004

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)
=((120 + 210.551) / 1190.436) / ((120.01 + 369.586) / 1434.066)
=0.27767221 / 0.34140409
=0.8133

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
=(-54.629 - 0 - 105.803) / 1190.436
=-0.1348

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.

Regis Corp has a M-score of -3.36 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.

Regis Corp Annual Data

Jun05Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13Jun14
DSRI 1.19461.18261.00260.53521.41010.52941.2081.19491.10071.0616
GMI 1.00591.0010.99281.02541.0080.99151.01550.99691.06131.0097
AQI 1.16321.00940.98091.12141.03620.97171.04420.91110.75480.8947
SGI 1.1411.10781.08051.04270.88720.97060.92440.97340.95120.9374
DEPI 0.94620.92640.94720.96260.8781.02411.00510.82591.26350.9035
SGAI 1.07290.9621.00760.98810.99421.03261.07210.97571.00720.9847
LVGI 1.23490.99321.02960.96990.96750.76080.8651.09490.83681.311
TATA -0.0893-0.087-0.066-0.0617-0.1651-0.0779-0.1318-0.1704-0.0287-0.1788
M-score -2.62-2.62-2.74-3.09-2.96-3.24-2.91-3.21-2.55-3.46

Regis Corp Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.17680.77331.00681.10071.78211.92570.7951.06160.42430.6368
GMI 1.00481.01651.02311.06131.05441.04881.04431.00971.00681.0008
AQI 0.80680.83110.85940.75480.85730.77350.77080.89471.03181.1315
SGI 0.98260.99581.00280.95120.94550.93640.93420.93740.95280.9649
DEPI 0.99471.15891.23861.26351.11750.95910.86970.90350.93720.9766
SGAI 0.95660.94680.97161.00721.00941.01080.99130.98470.9891.0004
LVGI 1.05371.02641.02150.83680.84881.08441.09381.3111.01640.8133
TATA -0.1484-0.123-0.1086-0.0287-0.0622-0.1155-0.1325-0.1788-0.2168-0.1348
M-score -3.11-3.31-3.00-2.55-2.07-2.33-3.46-3.46-4.06-3.36
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