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Travelzoo Inc (NAS:TZOO)
Beneish M-Score
-1.52 (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 -1.52 signals that the company is a manipulator.

TZOO' s 10-Year Beneish M-Score Range
Min: -3.59   Max: -1.52
Current: -1.52

-3.59
-1.52

During the past 13 years, the highest Beneish M-Score of Travelzoo Inc was -1.52. The lowest was -3.59. And the median was -2.11.


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 * 1.1633+0.528 * 1.0184+0.404 * 1.0241+0.892 * 0.8979+0.115 * 1.1136
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0578+4.679 * 0.1638-0.327 * 0.6527
=-1.52

* 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 $14.6 Mil.
Revenue was 31.498 + 33.5 + 36.883 + 40.195 = $142.1 Mil.
Gross Profit was 27.218 + 29.025 + 32.509 + 35.418 = $124.2 Mil.
Total Current Assets was $77.4 Mil.
Total Assets was $90.5 Mil.
Property, Plant and Equipment(Net PPE) was $9.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $2.8 Mil.
Selling, General & Admin. Expense(SGA) was $110.7 Mil.
Total Current Liabilities was $36.3 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 1.255 + 2.536 + 7.924 + 4.638 = $16.4 Mil.
Non Operating Income was -0.187 + 0.01 + 0.056 + 0.122 = $0.0 Mil.
Cash Flow from Operations was -0.168 + 0.476 + -0.529 + 1.751 = $1.5 Mil.
Accounts Receivable was $14.0 Mil.
Revenue was 37.475 + 37.256 + 41.327 + 42.177 = $158.2 Mil.
Gross Profit was 32.806 + 32.934 + 36.902 + 38.192 = $140.8 Mil.
Total Current Assets was $101.5 Mil.
Total Assets was $114.8 Mil.
Property, Plant and Equipment(Net PPE) was $8.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $3.0 Mil.
Selling, General & Admin. Expense(SGA) was $116.6 Mil.
Total Current Liabilities was $70.6 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)
=(14.608 / 142.076) / (13.986 / 158.235)
=0.10281821 / 0.08838752
=1.1633

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)
=(29.025 / 158.235) / (27.218 / 142.076)
=0.89003065 / 0.87396886
=1.0184

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 - (77.363 + 9.022) / 90.488) / (1 - (101.474 + 8.245) / 114.802)
=0.04534303 / 0.04427623
=1.0241

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
=142.076 / 158.235
=0.8979

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))
=(2.98 / (2.98 + 8.245)) / (2.824 / (2.824 + 9.022))
=0.26547884 / 0.23839271
=1.1136

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)
=(110.703 / 142.076) / (116.555 / 158.235)
=0.77918156 / 0.73659431
=1.0578

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 + 36.302) / 90.488) / ((0 + 70.562) / 114.802)
=0.40118027 / 0.61464086
=0.6527

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
=(16.353 - 0.001 - 1.53) / 90.488
=0.1638

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 -1.52 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.12320.58891.20751.11630.85110.98180.76321.00230.98061.1633
GMI 0.99660.99761.0121.00891.02631.00471.02771.01631.00651.0184
AQI 1.46190.93842.71033.07341.75681.23650.98921.02080.60171.0241
SGI 1.50751.36941.1351.02421.16281.20021.31531.01911.04670.8979
DEPI 1.16841.18491.82571.69250.42710.79720.94731.17081.39561.1136
SGAI 1.05840.80761.27811.12370.99270.91560.92731.0491.04131.0578
LVGI 1.80211.26181.71291.30130.74581.05381.62340.99681.37710.6527
TATA -0.0027-0.0116-0.0258-0.03640.003-0.1602-0.179-0.1891-0.19040.1638
M-score -1.99-2.64-1.78-1.72-2.12-3.00-3.44-3.32-3.59-1.52

Travelzoo Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.04151.00231.02190.99230.90810.98060.9891.09831.12881.1633
GMI 1.02141.01631.00331.00381.00411.00651.01661.01581.01951.0184
AQI 0.63471.02081.03260.99640.74230.60170.8250.95891.4661.0241
SGI 1.0541.01911.02191.02271.05691.04671.01460.97330.93830.8979
DEPI 1.11711.17081.28291.28171.24651.39561.48061.42631.35791.1136
SGAI 1.00191.0491.07681.13031.08751.04131.01610.99591.01461.0578
LVGI 0.81620.99680.89570.97061.44751.37711.31221.11750.73670.6527
TATA -0.1028-0.1891-0.1299-0.1669-0.3186-0.1904-0.1867-0.04980.19690.1638
M-score -2.94-3.32-2.98-3.23-4.24-3.59-3.46-2.64-1.17-1.52
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