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Valero Energy Corp (NYSE:VLO)
Beneish M-Score
-3.30 (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 -3.30 suggests that the company is not a manipulator.

VLO' s Beneish M-Score Range Over the Past 10 Years
Min: -90.19   Max: 2.16
Current: -3.3

-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 -2.44.


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 * 0.8073+0.528 * 0.5683+0.404 * 1.0438+0.892 * 0.7051+0.115 * 0.9705
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.478+4.679 * -0.0288-0.327 * 0.854
=-3.30

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

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Accounts Receivable was $4,698 Mil.
Revenue was 22579 + 25118 + 21330 + 27859 = $96,886 Mil.
Gross Profit was 2800 + 2681 + 2083 + 2435 = $9,999 Mil.
Total Current Assets was $16,827 Mil.
Total Assets was $45,825 Mil.
Property, Plant and Equipment(Net PPE) was $26,688 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,773 Mil.
Selling, General & Admin. Expense(SGA) was $718 Mil.
Total Current Liabilities was $8,289 Mil.
Long-Term Debt was $7,252 Mil.
Net Income was 1377 + 1351 + 964 + 1155 = $4,847 Mil.
Non Operating Income was 3 + 8 + 24 + 9 = $44 Mil.
Cash Flow from Operations was 1362 + 2329 + 1433 + 997 = $6,121 Mil.
Accounts Receivable was $8,254 Mil.
Revenue was 34408 + 34914 + 33663 + 34429 = $137,414 Mil.
Gross Profit was 2280 + 1669 + 1932 + 2178 = $8,059 Mil.
Total Current Assets was $19,666 Mil.
Total Assets was $48,455 Mil.
Property, Plant and Equipment(Net PPE) was $26,449 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,702 Mil.
Selling, General & Admin. Expense(SGA) was $689 Mil.
Total Current Liabilities was $13,460 Mil.
Long-Term Debt was $5,783 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)
=(4698 / 96886) / (8254 / 137414)
=0.04848998 / 0.06006666
=0.8073

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)
=(2681 / 137414) / (2800 / 96886)
=0.05864759 / 0.10320377
=0.5683

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 - (16827 + 26688) / 45825) / (1 - (19666 + 26449) / 48455)
=0.05040917 / 0.04829223
=1.0438

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
=96886 / 137414
=0.7051

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))
=(1702 / (1702 + 26449)) / (1773 / (1773 + 26688))
=0.06045966 / 0.06229577
=0.9705

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)
=(718 / 96886) / (689 / 137414)
=0.00741077 / 0.00501405
=1.478

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)
=((7252 + 8289) / 45825) / ((5783 + 13460) / 48455)
=0.33913803 / 0.39713136
=0.854

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
=(4847 - 44 - 6121) / 45825
=-0.0288

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 -3.30 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 1.13151.61290.31722.28610.95271.18460.88221.06140.6765
GMI 0.78811.14271.58011.85230.7471.01010.86141.14370.7333
AQI 0.75630.95740.70750.82810.44681.0021.01081.24751.0034
SGI 1.08711.08771.18680.5711.2731.53211.09850.99770.9476
DEPI 0.86290.90820.92470.97691.08151.06241.0170.90041.0548
SGAI 0.9630.96890.80560.75490.72930.70191.11281.08851.0079
LVGI 0.93451.20530.84221.16141.02931.04880.91010.99190.8436
TATA -0.0376-0.0045-0.1261-0.1074-0.0751-0.0465-0.0719-0.0683-0.0144
M-score -2.66-1.87-3.27-1.81-2.94-2.00-2.89-2.59-2.98

Valero Energy Corp Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
DSRI 1.24031.06141.00481.0510.90490.67650.7460.92460.8073
GMI 1.03271.31721.39611.12960.81530.73360.67860.57110.5683
AQI 1.17851.24751.17281.13381.08631.00341.05380.96021.0438
SGI 0.98750.99771.01141.02260.99950.94760.85710.78130.7051
DEPI 0.9250.90040.92850.98171.01991.05481.03081.02140.9705
SGAI 0.44170.41720.40020.86010.89761.00791.11791.35531.478
LVGI 1.00740.99190.94680.94020.92250.84360.86920.92060.854
TATA -0.0209-0.0683-0.0372-0.0319-0.0493-0.0144-0.0376-0.0451-0.0288
M-score -2.19-2.39-2.25-2.40-2.82-2.97-3.14-3.23-3.30
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