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Ulta Salon Cosmetics & Fragrances Inc (NAS:ULTA)
Beneish M-Score
-2.54 (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 -2.54 suggests that the company is not a manipulator.

ULTA' s Beneish M-Score Range Over the Past 10 Years
Min: -4.09   Max: 10000000
Current: -2.54

-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 -3.01.


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 * 0.8525+0.528 * 1.0093+0.404 * 1.2694+0.892 * 1.2096+0.115 * 0.9923
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9784+4.679 * -0.0449-0.327 * 1.0633
=-2.54

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

This Year (Oct15) TTM:Last Year (Oct14) TTM:
Accounts Receivable was $51 Mil.
Revenue was 910.7 + 876.999 + 868.122 + 1047.641 = $3,703 Mil.
Gross Profit was 335.638 + 306.475 + 303.184 + 349.737 = $1,295 Mil.
Total Current Assets was $1,388 Mil.
Total Assets was $2,240 Mil.
Property, Plant and Equipment(Net PPE) was $844 Mil.
Depreciation, Depletion and Amortization(DDA) was $155 Mil.
Selling, General & Admin. Expense(SGA) was $821 Mil.
Total Current Liabilities was $458 Mil.
Long-Term Debt was $0 Mil.
Net Income was 71.07 + 74.169 + 66.946 + 87.264 = $299 Mil.
Non Operating Income was 0 + 0 + 0.622 + 0 = $1 Mil.
Cash Flow from Operations was 23.277 + 57.404 + 68.292 + 250.442 = $399 Mil.
Accounts Receivable was $49 Mil.
Revenue was 745.722 + 734.236 + 713.77 + 868.082 = $3,062 Mil.
Gross Profit was 281.755 + 259.342 + 245.953 + 293.561 = $1,081 Mil.
Total Current Assets was $1,231 Mil.
Total Assets was $1,923 Mil.
Property, Plant and Equipment(Net PPE) was $687 Mil.
Depreciation, Depletion and Amortization(DDA) was $125 Mil.
Selling, General & Admin. Expense(SGA) was $694 Mil.
Total Current Liabilities was $370 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)
=(50.939 / 3703.462) / (49.399 / 3061.81)
=0.01375443 / 0.01613392
=0.8525

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)
=(306.475 / 3061.81) / (335.638 / 3703.462)
=0.35293209 / 0.349682
=1.0093

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 - (1388.19 + 844.238) / 2239.998) / (1 - (1230.742 + 686.898) / 1922.759)
=0.00337947 / 0.00266232
=1.2694

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
=3703.462 / 3061.81
=1.2096

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))
=(124.766 / (124.766 + 686.898)) / (154.76 / (154.76 + 844.238))
=0.15371632 / 0.15491523
=0.9923

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)
=(820.756 / 3703.462) / (693.525 / 3061.81)
=0.22161858 / 0.22650818
=0.9784

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 + 457.976) / 2239.998) / ((0 + 369.711) / 1922.759)
=0.20445375 / 0.19228151
=1.0633

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
=(299.449 - 0.622 - 399.415) / 2239.998
=-0.0449

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 -2.54 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.

Ulta Salon Cosmetics & Fragrances Inc Annual Data

Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15
DSRI 0.92490.74420.94220.9183
GMI 1.00161.02851.00151.005
AQI 0.658201.19211.0645
SGI 1.2081.18911.20281.2137
DEPI 1.08270.95651.02010.9754
SGAI 1.00530.99961.01290.9752
LVGI 0.99980.90630.96031.0892
TATA -0.0363-0.0878-0.0779-0.0703
M-score -2.66-3.32-2.63-2.69

Ulta Salon Cosmetics & Fragrances Inc Quarterly Data

Jul13Oct13Jan14Apr14Jul14Oct14Jan15Apr15Jul15Oct15
DSRI 0.94220.74231.13320.88090.91831.34490.89180.8525
GMI 1.00150.99921.00181.00371.0050.99811.00111.0093
AQI 1.19211.0551.12111.04461.06451.37681.27421.2694
SGI 1.20281.2031.19881.19541.21371.21211.20571.2096
DEPI 1.02010.99480.97980.95050.97540.99280.98960.9923
SGAI 1.0181.01440.9980.98310.97520.9720.97780.9784
LVGI 0.96030.95531.00861.02641.08921.03741.03751.0633
TATA -0.0779-0.0871-0.0843-0.0695-0.0705-0.0566-0.0483-0.0449
M-score -2.63-2.91-2.53-2.73-2.69-2.10-2.52-2.54
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