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Valero Energy Corp (NYSE:VLO)
Beneish M-Score
-2.76 (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.

Valero Energy Corp has a M-score of -2.76 suggests that the company is not a manipulator.

VLO' s Beneish M-Score Range Over the Past 10 Years
Min: -90.16   Max: 2.19
Current: -2.76

-90.16
2.19

During the past 13 years, the highest Beneish M-Score of Valero Energy Corp was 2.19. The lowest was -90.16. And the median was -2.42.


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 Valero Energy Corp 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 * 1.309+0.528 * 0.7077+0.404 * 1.1633+0.892 * 0.6935+0.115 * 0.9171
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.4582+4.679 * -0.03-0.327 * 0.9112
=-2.76

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

This Year (Mar16) TTM:Last Year (Mar15) TTM:
Accounts Receivable was $4,518 Mil.
Revenue was 15714 + 18777 + 22579 + 25118 = $82,188 Mil.
Gross Profit was 1470 + 1346 + 2800 + 2681 = $8,297 Mil.
Total Current Assets was $14,861 Mil.
Total Assets was $44,259 Mil.
Property, Plant and Equipment(Net PPE) was $26,745 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,886 Mil.
Selling, General & Admin. Expense(SGA) was $719 Mil.
Total Current Liabilities was $6,775 Mil.
Long-Term Debt was $7,207 Mil.
Net Income was 495 + 298 + 1377 + 1351 = $3,521 Mil.
Non Operating Income was 9 + 11 + 3 + 8 = $31 Mil.
Cash Flow from Operations was 640 + 487 + 1362 + 2329 = $4,818 Mil.
Accounts Receivable was $4,977 Mil.
Revenue was 21330 + 27859 + 34408 + 34914 = $118,511 Mil.
Gross Profit was 2083 + 2435 + 2280 + 1669 = $8,467 Mil.
Total Current Assets was $16,788 Mil.
Total Assets was $45,741 Mil.
Property, Plant and Equipment(Net PPE) was $26,596 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,710 Mil.
Selling, General & Admin. Expense(SGA) was $711 Mil.
Total Current Liabilities was $8,634 Mil.
Long-Term Debt was $7,224 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)
=(4518 / 82188) / (4977 / 118511)
=0.05497153 / 0.0419961
=1.309

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)
=(8467 / 118511) / (8297 / 82188)
=0.07144484 / 0.10095148
=0.7077

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 - (14861 + 26745) / 44259) / (1 - (16788 + 26596) / 45741)
=0.05994261 / 0.05152926
=1.1633

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
=82188 / 118511
=0.6935

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))
=(1710 / (1710 + 26596)) / (1886 / (1886 + 26745))
=0.06041122 / 0.06587266
=0.9171

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)
=(719 / 82188) / (711 / 118511)
=0.00874824 / 0.00599944
=1.4582

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)
=((7207 + 6775) / 44259) / ((7224 + 8634) / 45741)
=0.31591315 / 0.34669115
=0.9112

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
=(3521 - 31 - 4818) / 44259
=-0.03

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.

Valero Energy Corp has a M-score of -2.76 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.

Valero Energy Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.10051.690.30122.28171.0051.18460.87681.06790.67651.1084
GMI 0.81.13461.6941.41930.90931.01010.87641.12320.7340.6263
AQI 0.75630.95740.70750.82810.44681.0021.01081.24751.00341.2452
SGI 1.11771.03811.24950.57211.20681.53211.10530.99160.94760.6711
DEPI 0.86290.90820.92470.97691.08151.06241.0170.90041.05480.9214
SGAI 1.01990.95440.76511.67820.34540.70191.1061.09521.00791.4614
LVGI 0.93451.20530.84221.16141.02931.04880.91010.99190.84360.9523
TATA -0.0328-0.0045-0.1231-0.1074-0.0751-0.0465-0.0719-0.0683-0.0144-0.0376
M-score -2.64-1.85-3.14-2.21-2.80-2.00-2.88-2.60-2.97-3.02

Valero Energy Corp Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
DSRI 1.06141.00481.0510.90490.67650.7460.92460.80731.10841.309
GMI 1.31721.39611.12960.81530.73360.67860.57110.56830.62630.7077
AQI 1.24751.17281.13381.08631.00341.05380.96021.04381.24521.1633
SGI 0.99771.01141.02260.99950.94760.85710.78130.70510.67110.6935
DEPI 0.90040.92850.98171.01991.05481.03081.02140.97050.92140.9171
SGAI 0.41720.40020.86010.89761.00791.11791.35531.4781.46141.4582
LVGI 0.99190.94680.94020.92250.84360.86920.92060.8540.95230.9112
TATA -0.0683-0.0372-0.0319-0.0493-0.0144-0.0376-0.0451-0.0288-0.0376-0.03
M-score -2.39-2.25-2.40-2.82-2.97-3.14-3.23-3.30-3.02-2.76
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