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Valero Energy Corp (NYSE:VLO)
Beneish M-Score
-2.46 (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 -2.46 suggests that the company is not a manipulator.

VLO' s 10-Year Beneish M-Score Range
Min: -90.19   Max: 2.16
Current: -2.46

-90.19
2.16

During the past 13 years, the highest Beneish M-Score of Valero Energy Corp was 2.16. The lowest was -90.19. And the median was -2.39.


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 * 1.0127+0.528 * 1.1864+0.404 * 1.1728+0.892 * 1.0051+0.115 * 0.9285
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9808+4.679 * -0.0372-0.327 * 0.9468
=-2.46

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $7,887 Mil.
Revenue was 33663 + 34429 + 36137 + 34034 = $138,263 Mil.
Gross Profit was 1931 + 2178 + 1150 + 2511 = $7,770 Mil.
Total Current Assets was $19,030 Mil.
Total Assets was $47,099 Mil.
Property, Plant and Equipment(Net PPE) was $25,766 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,711 Mil.
Selling, General & Admin. Expense(SGA) was $1,807 Mil.
Total Current Liabilities was $12,926 Mil.
Long-Term Debt was $5,860 Mil.
Net Income was 828 + 1288 + 312 + 466 = $2,894 Mil.
Non Operating Income was 15 + 342 + 17 + 11 = $385 Mil.
Cash Flow from Operations was 244 + 2529 + 221 + 1265 = $4,259 Mil.
Accounts Receivable was $7,748 Mil.
Revenue was 33474 + 34695 + 34726 + 34662 = $137,557 Mil.
Gross Profit was 1667 + 2233 + 2230 + 3041 = $9,171 Mil.
Total Current Assets was $17,206 Mil.
Total Assets was $45,501 Mil.
Property, Plant and Equipment(Net PPE) was $26,398 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,620 Mil.
Selling, General & Admin. Expense(SGA) was $1,833 Mil.
Total Current Liabilities was $12,705 Mil.
Long-Term Debt was $6,463 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)
=(7887 / 138263) / (7748 / 137557)
=0.05704346 / 0.05632574
=1.0127

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)
=(2178 / 137557) / (1931 / 138263)
=0.06667054 / 0.05619725
=1.1864

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 - (19030 + 25766) / 47099) / (1 - (17206 + 26398) / 45501)
=0.048897 / 0.04169139
=1.1728

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
=138263 / 137557
=1.0051

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))
=(1620 / (1620 + 26398)) / (1711 / (1711 + 25766))
=0.05781997 / 0.06227026
=0.9285

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)
=(1807 / 138263) / (1833 / 137557)
=0.0130693 / 0.01332539
=0.9808

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)
=((5860 + 12926) / 47099) / ((6463 + 12705) / 45501)
=0.39886197 / 0.42126547
=0.9468

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
=(2894 - 385 - 4259) / 47099
=-0.0372

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 -2.46 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

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.96291.33881.11781.60120.33872.64290.82931.18170.84571.0674
GMI 0.83750.93830.78811.14271.58011.85230.7471.01010.87641.1232
AQI 0.8431.02330.75630.95740.70750.82810.44681.0021.01081.2475
SGI 1.43851.4761.08711.08771.18680.5711.2731.53211.10530.9916
DEPI 1.03761.20980.86290.90820.92470.97691.08151.06241.0170.9004
SGAI 0.75890.78630.9630.96890.80560.75490.72930.70191.1061.0952
LVGI 0.93220.87840.93451.20530.84221.16141.02931.04880.91010.9919
TATA -0.0591-0.0738-0.0376-0.0045-0.1261-0.1074-0.0751-0.0465-0.0719-0.0683
M-score -2.48-2.01-2.67-1.88-3.25-1.49-3.06-2.01-2.91-2.61

Valero Energy Corp Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 1.18170.82680.820.81260.84570.99361.10161.24061.06741.0127
GMI 1.01011.0330.87011.07080.75950.66310.82260.90351.11221.1864
AQI 1.0020.93660.96020.98651.01081.0741.15431.17851.24751.1728
SGI 1.53211.49751.37151.22691.10531.02010.99070.99360.99161.0051
DEPI 1.06241.04491.05841.03411.0171.00570.94580.9250.90040.9285
SGAI 0.70190.71632.18252.36852.88542.971.06081.04761.00960.9808
LVGI 1.04881.01220.97460.96470.91010.91930.98841.00740.99190.9468
TATA -0.0465-0.0468-0.0556-0.0811-0.0719-0.0467-0.0561-0.0209-0.0683-0.0372
M-score -2.01-2.37-2.85-3.02-3.28-3.15-2.70-2.36-2.60-2.46
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