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Ulta Salon Cosmetics & Fragrances Inc (NAS:ULTA)
Beneish M-Score
-2.10 (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.

Ulta Salon Cosmetics & Fragrances Inc has a M-score of -2.10 signals that the company is a manipulator.

ULTA' s 10-Year Beneish M-Score Range
Min: -4.09   Max: 10000000
Current: -2.1

-4.09
10000000

During the past 13 years, the highest Beneish M-Score of Ulta Salon Cosmetics & Fragrances Inc was 10000000.00. The lowest was -4.09. And the median was -3.12.


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 Ulta Salon Cosmetics & Fragrances 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 * 1.3449+0.528 * 0.9981+0.404 * 1.3768+0.892 * 1.2121+0.115 * 0.9928
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.972+4.679 * -0.0568-0.327 * 1.0374
=-2.10

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

This Year (Apr15) TTM:Last Year (Apr14) TTM:
Accounts Receivable was $44 Mil.
Revenue was 868.122 + 1047.641 + 745.722 + 734.236 = $3,396 Mil.
Gross Profit was 303.184 + 349.737 + 281.755 + 259.342 = $1,194 Mil.
Total Current Assets was $1,325 Mil.
Total Assets was $2,078 Mil.
Property, Plant and Equipment(Net PPE) was $745 Mil.
Depreciation, Depletion and Amortization(DDA) was $139 Mil.
Selling, General & Admin. Expense(SGA) was $757 Mil.
Total Current Liabilities was $384 Mil.
Long-Term Debt was $0 Mil.
Net Income was 66.946 + 87.264 + 59.124 + 60.794 = $274 Mil.
Non Operating Income was 0.622 + 0 + 0 + 0.418 = $1 Mil.
Cash Flow from Operations was 68.292 + 250.442 + 12.922 + 59.535 = $391 Mil.
Accounts Receivable was $27 Mil.
Revenue was 713.77 + 868.082 + 618.781 + 600.998 = $2,802 Mil.
Gross Profit was 245.953 + 293.561 + 231.661 + 212.077 = $983 Mil.
Total Current Assets was $1,090 Mil.
Total Assets was $1,699 Mil.
Property, Plant and Equipment(Net PPE) was $604 Mil.
Depreciation, Depletion and Amortization(DDA) was $112 Mil.
Selling, General & Admin. Expense(SGA) was $642 Mil.
Total Current Liabilities was $302 Mil.
Long-Term Debt was $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)
=(43.558 / 3395.721) / (26.722 / 2801.631)
=0.01282732 / 0.00953802
=1.3449

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)
=(349.737 / 2801.631) / (303.184 / 3395.721)
=0.350957 / 0.35162429
=0.9981

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 - (1325.201 + 744.665) / 2077.951) / (1 - (1090.49 + 603.933) / 1699.225)
=0.00389085 / 0.00282599
=1.3768

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
=3395.721 / 2801.631
=1.2121

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))
=(111.977 / (111.977 + 603.933)) / (139.258 / (139.258 + 744.665))
=0.15641212 / 0.1575454
=0.9928

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)
=(756.902 / 3395.721) / (642.478 / 2801.631)
=0.22289876 / 0.22932285
=0.972

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 + 383.664) / 2077.951) / ((0 + 302.419) / 1699.225)
=0.18463573 / 0.17797466
=1.0374

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
=(274.128 - 1.04 - 391.191) / 2077.951
=-0.0568

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.

Ulta Salon Cosmetics & Fragrances Inc has a M-score of -2.10 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.

Ulta Salon Cosmetics & Fragrances Inc Annual Data

Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15
DSRI 0.89920.92490.74420.94220.9183
GMI 0.96631.00161.02851.00151.005
AQI 0.89680.658201.19211.0645
SGI 1.3041.2081.18911.20281.2137
DEPI 0.92571.08270.95651.02010.9754
SGAI 1.03281.00530.99961.01290.9752
LVGI 0.9830.99980.90630.96031.0892
TATA -0.0879-0.0363-0.0878-0.0779-0.0703
M-score -2.78-2.66-3.32-2.63-2.69

Ulta Salon Cosmetics & Fragrances Inc Quarterly Data

Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14Jan15Apr15
DSRI 0.94220.74231.13320.88090.91831.3449
GMI 1.00150.99921.00181.00371.0050.9981
AQI 1.19211.0551.12111.04461.06451.3768
SGI 1.20281.2031.19881.19541.21371.2121
DEPI 1.02010.99480.97980.95050.97540.9928
SGAI 1.0181.01440.9980.98310.97520.972
LVGI 0.96030.95531.00861.02641.08921.0374
TATA -0.0779-0.0871-0.0845-0.0697-0.0707-0.0568
M-score -2.63-2.91-2.53-2.73-2.69-2.10
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