WEN has been removed from your Stock Email Alerts list.
Please enter Portfolio Name for new portfolio.
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.
During the past 13 years, the highest Beneish M-Score of Wendy's Co was 6.19. The lowest was -5.71. And the median was -2.52.
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 Wendy's Co 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 * 1.1238||+||0.528 * 0.8379||+||0.404 * 0.8147||+||0.892 * 0.8708||+||0.115 * 1.2464|
|-||0.172 * SGAI||+||4.679 * TATA||-||0.327 * LVGI|
|-||0.172 * 0.9764||+||4.679 * -0.0209||-||0.327 * 1.2546|
|This Year (Jun15) TTM:||Last Year (Jun14) TTM:|
|Accounts Receivable was $71 Mil.|
Revenue was 489.534 + 466.246 + 501.951 + 512.489 = $1,970 Mil.
Gross Profit was 174.412 + 162.974 + 166.932 + 168.682 = $673 Mil.
Total Current Assets was $1,554 Mil.
Total Assets was $5,107 Mil.
Property, Plant and Equipment(Net PPE) was $1,254 Mil.
Depreciation, Depletion and Amortization(DDA) was $157 Mil.
Selling, General & Admin. Expense(SGA) was $247 Mil.
Total Current Liabilities was $298 Mil.
Long-Term Debt was $2,380 Mil.
Net Income was 40.195 + 27.507 + 23.294 + 22.83 = $114 Mil.
Non Operating Income was -7.023 + 0.239 + 0.2 + 0.373 = $-6 Mil.
Cash Flow from Operations was 31.374 + 21.74 + 72.18 + 101.587 = $227 Mil.
|Accounts Receivable was $72 Mil.
Revenue was 506.079 + 523.196 + 592.405 + 640.779 = $2,262 Mil.
Gross Profit was 170.938 + 149.006 + 155.968 + 171.602 = $648 Mil.
Total Current Assets was $673 Mil.
Total Assets was $4,157 Mil.
Property, Plant and Equipment(Net PPE) was $1,188 Mil.
Depreciation, Depletion and Amortization(DDA) was $191 Mil.
Selling, General & Admin. Expense(SGA) was $290 Mil.
Total Current Liabilities was $321 Mil.
Long-Term Debt was $1,416 Mil.
1. DSRI = Days Sales in Receivables Index
A large increase in DSR could be indicative of revenue inflation.
|DSRI||=||(Receivables_t / Revenue_t)||/||(Receivables_t-1 / Revenue_t-1)|
|=||(70.515 / 1970.22)||/||(72.055 / 2262.459)|
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.
|=||(GrossProfit_t-1 / Revenue_t-1)||/||(GrossProfit_t / Revenue_t)|
|=||(162.974 / 2262.459)||/||(174.412 / 1970.22)|
3. AQI = Asset Quality Index
AQI is the ratio of asset quality in year t to year t-1.
|AQI||=||(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t)||/||(1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)|
|=||(1 - (1553.919 + 1254.489) / 5106.545)||/||(1 - (672.934 + 1187.648) / 4157.055)|
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.
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))|
|=||(190.74 / (190.74 + 1187.648))||/||(156.668 / (156.668 + 1254.489))|
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)|
|=||(246.992 / 1970.22)||/||(290.486 / 2262.459)|
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)|
|=||((2379.782 + 297.9) / 5106.545)||/||((1416.411 + 321.01) / 4157.055)|
8. TATA = Total Accruals to Total Assets
Total accruals calculated as the change in working capital accounts other than cash less depreciation.
|=||(NetIncome_t - NonOperatingIncome_t||-||CashFlowsfromOperations_t)||/||TotalAssets_t|
|=||(113.826 - -6.211||-||226.881)||/||5106.545|
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.
Wendy's Co has a M-score of -2.79 suggests that the company will not be a manipulator.
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
Wendy's Co Annual Data
Wendy's Co Quarterly Data