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GuruFocus has detected 2 Warning Signs with Tyler Technologies Inc $TYL.
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Tyler Technologies Inc (NYSE:TYL)
Beneish M-Score
-2.65 (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.

Tyler Technologies Inc has a M-score of -2.65 suggests that the company is not a manipulator.

TYL' s Beneish M-Score Range Over the Past 10 Years
Min: -3.17   Max: 48
Current: -2.65

-3.17
48

During the past 13 years, the highest Beneish M-Score of Tyler Technologies Inc was 48.00. The lowest was -3.17. And the median was -2.69.


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 Tyler Technologies 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 * 0.888+0.528 * 0.9978+0.404 * 0.962+0.892 * 1.2792+0.115 * 0.5629
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9802+4.679 * -0.0589-0.327 * 0.9196
=-2.65

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $200.3 Mil.
Revenue was 193.281 + 194.497 + 188.972 + 179.293 = $756.0 Mil.
Gross Profit was 92.817 + 93.48 + 86.936 + 82.118 = $355.4 Mil.
Total Current Assets was $283.0 Mil.
Total Assets was $1,357.9 Mil.
Property, Plant and Equipment(Net PPE) was $124.3 Mil.
Depreciation, Depletion and Amortization(DDA) was $50.3 Mil.
Selling, General & Admin. Expense(SGA) was $167.2 Mil.
Total Current Liabilities was $361.5 Mil.
Long-Term Debt was $10.0 Mil.
Net Income was 51.642 + 22.264 + 18.872 + 17.079 = $109.9 Mil.
Non Operating Income was -0.285 + -0.526 + -0.72 + -0.467 = $-2.0 Mil.
Cash Flow from Operations was 70.621 + 67.091 + 13.877 + 40.27 = $191.9 Mil.
Accounts Receivable was $176.4 Mil.
Revenue was 158.916 + 150.845 + 146.295 + 134.966 = $591.0 Mil.
Gross Profit was 73.222 + 71.833 + 68.253 + 63.879 = $277.2 Mil.
Total Current Assets was $268.2 Mil.
Total Assets was $1,356.6 Mil.
Property, Plant and Equipment(Net PPE) was $101.1 Mil.
Depreciation, Depletion and Amortization(DDA) was $19.6 Mil.
Selling, General & Admin. Expense(SGA) was $133.3 Mil.
Total Current Liabilities was $337.6 Mil.
Long-Term Debt was $66.0 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)
=(200.334 / 756.043) / (176.36 / 591.022)
=0.26497699 / 0.29839837
=0.888

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)
=(277.187 / 591.022) / (355.351 / 756.043)
=0.46899608 / 0.47001427
=0.9978

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 - (282.96 + 124.268) / 1357.945) / (1 - (268.215 + 101.112) / 1356.57)
=0.70011451 / 0.7277494
=0.962

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
=756.043 / 591.022
=1.2792

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))
=(19.574 / (19.574 + 101.112)) / (50.301 / (50.301 + 124.268))
=0.16218948 / 0.28814394
=0.5629

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)
=(167.161 / 756.043) / (133.317 / 591.022)
=0.22109986 / 0.22557028
=0.9802

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)
=((10 + 361.501) / 1357.945) / ((66 + 337.572) / 1356.57)
=0.27357588 / 0.29749442
=0.9196

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
=(109.857 - -1.998 - 191.859) / 1357.945
=-0.0589

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.

Tyler Technologies Inc has a M-score of -2.65 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 local exchange's currency.

Tyler Technologies Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.97680.99790.96371.01341.02580.93860.93660.89321.30610.888
GMI 0.99720.92750.93360.99770.96920.99370.99540.97981.00910.9978
AQI 0.90671.22050.90991.07021.00771.01340.72270.80152.48510.962
SGI 1.12541.20611.0950.99431.07191.17431.14681.18351.19861.2792
DEPI 1.08371.65371.53540.8881.14230.94571.2480.96661.11840.5629
SGAI 0.88881.00861.01760.99661.01570.97610.98850.93071.02740.9802
LVGI 1.0341.2860.92860.98861.52270.77120.77970.94540.7280.9196
TATA -0.0762-0.1355-0.0583-0.0324-0.0896-0.0678-0.0578-0.1466-0.0515-0.0589
M-score -2.77-2.90-2.69-2.61-2.98-2.62-2.69-3.17-1.56-2.65

Tyler Technologies Inc Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 1.04060.89321.08060.89290.98411.30611.05321.0911.13050.888
GMI 0.97370.97980.9810.99121.00221.00911.02111.0221.01590.9978
AQI 0.73990.80150.82550.86740.94142.48512.4342.43672.40790.962
SGI 1.18721.18351.18911.18171.17451.19861.23261.26181.28981.2792
DEPI 0.96040.96660.98250.98540.98281.11840.90810.74060.66950.5629
SGAI 0.94220.93070.92780.93590.95331.02741.05951.09011.09190.9802
LVGI 0.9180.94540.93570.84080.84330.7280.93750.92660.79110.9196
TATA -0.0909-0.1466-0.1055-0.0942-0.069-0.0515-0.0848-0.0763-0.0864-0.0589
M-score -2.79-3.17-2.78-2.85-2.63-1.56-2.03-1.95-1.91-2.65
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