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Travelzoo Inc (NAS:TZOO)
Beneish M-Score
-1.90 (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.

Travelzoo Inc has a M-score of -1.90 signals that the company is a manipulator.

TZOO' s Beneish M-Score Range Over the Past 10 Years
Min: -3.61   Max: -1.37
Current: -1.9

-3.61
-1.37

During the past 13 years, the highest Beneish M-Score of Travelzoo Inc was -1.37. The lowest was -3.61. And the median was -2.05.


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 Travelzoo 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 * 1.1016+0.528 * 1.0088+0.404 * 1.1074+0.892 * 0.9232+0.115 * 0.9174
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.008+4.679 * 0.1309-0.327 * 1.2944
=-1.90

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

This Year (Dec15) TTM:Last Year (Dec14) TTM:
Accounts Receivable was $16.4 Mil.
Revenue was 32.051 + 33.728 + 34.064 + 36.492 = $136.3 Mil.
Gross Profit was 27.723 + 28.986 + 29.159 + 32.258 = $118.1 Mil.
Total Current Assets was $57.1 Mil.
Total Assets was $68.6 Mil.
Property, Plant and Equipment(Net PPE) was $7.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $2.8 Mil.
Selling, General & Admin. Expense(SGA) was $103.7 Mil.
Total Current Liabilities was $41.0 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 0.435 + 8.857 + 1.326 + 1.909 = $12.5 Mil.
Non Operating Income was -0.376 + -0.202 + 0.021 + -0.087 = $-0.6 Mil.
Cash Flow from Operations was 3.117 + -1.723 + 0.372 + 2.426 = $4.2 Mil.
Accounts Receivable was $16.1 Mil.
Revenue was 34.291 + 36.307 + 36.883 + 40.195 = $147.7 Mil.
Gross Profit was 29.651 + 31.494 + 32.509 + 35.418 = $129.1 Mil.
Total Current Assets was $79.4 Mil.
Total Assets was $93.3 Mil.
Property, Plant and Equipment(Net PPE) was $9.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $3.0 Mil.
Selling, General & Admin. Expense(SGA) was $111.4 Mil.
Total Current Liabilities was $43.1 Mil.
Long-Term Debt was $0.0 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)
=(16.398 / 136.335) / (16.124 / 147.676)
=0.12027726 / 0.10918497
=1.1016

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)
=(28.986 / 147.676) / (27.723 / 136.335)
=0.87402151 / 0.86643929
=1.0088

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 - (57.061 + 7.905) / 68.579) / (1 - (79.37 + 9.498) / 93.307)
=0.05268377 / 0.04757414
=1.1074

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
=136.335 / 147.676
=0.9232

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))
=(2.986 / (2.986 + 9.498)) / (2.788 / (2.788 + 7.905))
=0.23918616 / 0.26073132
=0.9174

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)
=(103.682 / 136.335) / (111.418 / 147.676)
=0.76049437 / 0.75447602
=1.008

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)
=((0 + 41.015) / 68.579) / ((0 + 43.111) / 93.307)
=0.59806938 / 0.46203393
=1.2944

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
=(12.527 - -0.644 - 4.192) / 68.579
=0.1309

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.

Travelzoo Inc has a M-score of -1.90 signals that the company is likely to 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.

Travelzoo Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.58891.20751.11630.85110.98180.76321.00230.90931.28371.0997
GMI 0.99761.0121.00891.02631.00471.02771.01631.00461.01921.0089
AQI 0.93842.71033.07341.75681.23650.98921.02080.60171.07451.1074
SGI 1.36941.1351.02421.16281.20021.31531.01911.12880.89810.9248
DEPI 1.18491.82571.69250.42710.79720.94731.17081.34741.14960.9174
SGAI 0.80761.27811.12370.99270.91560.92731.0490.99561.04260.992
LVGI 1.26181.71291.30130.74581.05381.62340.99681.37710.75171.2944
TATA -0.0116-0.0258-0.03640.003-0.1602-0.1801-0.1891-0.19620.1560.1154
M-score -2.64-1.78-1.72-2.12-3.00-3.45-3.32-3.61-1.45-1.97

Travelzoo Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 0.90810.90930.91631.01541.02371.33211.21861.22321.33781.1016
GMI 1.00411.00461.01411.01291.01621.02031.01281.01691.01491.0088
AQI 0.74230.60170.8250.95891.4661.07450.73950.71840.97911.1074
SGI 1.05691.12881.09511.05281.03470.86550.85370.85960.84880.9232
DEPI 1.24651.34741.42631.37221.27441.14960.89170.88850.91040.9174
SGAI 1.08750.99560.9710.95050.95171.07131.10241.13271.11211.008
LVGI 1.44751.37711.31221.11750.73670.75170.71790.81481.41.2944
TATA -0.3213-0.1961-0.1935-0.05650.2060.17060.1420.05780.17580.1309
M-score -4.25-3.61-3.49-2.68-1.14-1.37-1.78-2.21-1.64-1.90
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