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Winmark Corp (NAS:WINA)
Beneish M-Score
-2.37 (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.

Winmark Corp has a M-score of -2.37 suggests that the company is not a manipulator.

WINA' s 10-Year Beneish M-Score Range
Min: -5.87   Max: 16.36
Current: -2.37

-5.87
16.36

During the past 13 years, the highest Beneish M-Score of Winmark Corp was 16.36. The lowest was -5.87. And the median was -2.94.


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 Winmark 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 * 0.9546+0.528 * 0.9934+0.404 * 0.9904+0.892 * 1.184+0.115 * 1.0052
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0626+4.679 * -0.0237-0.327 * 0.6388
=-2.37

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

This Year (Mar15) TTM:Last Year (Mar14) TTM:
Accounts Receivable was $1.19 Mil.
Revenue was 21.024 + 16.183 + 16.404 + 14.039 = $67.65 Mil.
Gross Profit was 20.326 + 15.719 + 15.662 + 13.261 = $64.97 Mil.
Total Current Assets was $23.40 Mil.
Total Assets was $49.07 Mil.
Property, Plant and Equipment(Net PPE) was $1.37 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.41 Mil.
Selling, General & Admin. Expense(SGA) was $29.41 Mil.
Total Current Liabilities was $17.77 Mil.
Long-Term Debt was $0.00 Mil.
Net Income was 6.054 + 5.611 + 5.623 + 4.281 = $21.57 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 11.748 + 2.557 + 7.83 + 0.599 = $22.73 Mil.
Accounts Receivable was $1.05 Mil.
Revenue was 14.553 + 13.767 + 14.792 + 14.024 = $57.14 Mil.
Gross Profit was 13.491 + 13.296 + 14.223 + 13.499 = $54.51 Mil.
Total Current Assets was $22.10 Mil.
Total Assets was $47.03 Mil.
Property, Plant and Equipment(Net PPE) was $1.41 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.43 Mil.
Selling, General & Admin. Expense(SGA) was $23.38 Mil.
Total Current Liabilities was $26.45 Mil.
Long-Term Debt was $0.20 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)
=(1.189 / 67.65) / (1.052 / 57.136)
=0.01757576 / 0.01841221
=0.9546

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)
=(15.719 / 57.136) / (20.326 / 67.65)
=0.95402198 / 0.96035477
=0.9934

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 - (23.403 + 1.365) / 49.074) / (1 - (22.104 + 1.405) / 47.029)
=0.49529282 / 0.50011695
=0.9904

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
=67.65 / 57.136
=1.184

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))
=(0.429 / (0.429 + 1.405)) / (0.414 / (0.414 + 1.365))
=0.23391494 / 0.23271501
=1.0052

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)
=(29.414 / 67.65) / (23.38 / 57.136)
=0.43479675 / 0.4091991
=1.0626

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 + 17.767) / 49.074) / ((0.204 + 26.448) / 47.029)
=0.36204507 / 0.56671416
=0.6388

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
=(21.569 - 0 - 22.734) / 49.074
=-0.0237

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.

Winmark Corp has a M-score of -2.37 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.

Winmark Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.92951.16660.92131.08680.58560.06990.324622.22760.01360.9109
GMI 0.92630.94920.98980.98260.97890.96780.95021.00460.98871.0034
AQI 1.21411.02381.04950.79550.69481.29480.92911.13430.73681.1487
SGI 0.97791.0291.13861.13671.05281.10481.24591.01181.07291.0978
DEPI 1.0331.08660.82520.73221.93671.07890.84410.94151.09331.0589
SGAI 1.27111.02490.99730.87490.92010.88051.04160.90271.00470.974
LVGI 1.23043.84551.35110.93890.9260.54350.4492.89180.42052.6766
TATA -0.0707-0.0498-0.05-0.0806-0.136-0.043-0.1067-0.0325-0.06440.0381
M-score -2.97-3.48-2.78-2.74-3.44-3.16-3.2816.36-3.54-2.77

Winmark Corp Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 22.22850.92351.05060.90610.01360.80970.85260.9290.91090.9546
GMI 1.00460.99980.99630.99610.98870.99711.00551.00931.01070.9934
AQI 1.13430.91590.84970.69120.73680.95110.90791.12091.14870.9904
SGI 1.01181.02291.12361.05811.07291.07281.03741.06681.09781.184
DEPI 0.94140.95940.95890.93231.09711.13681.23241.31811.05911.0052
SGAI 0.89980.91170.95520.9650.98190.96870.99921.00090.98291.0626
LVGI 2.89180.68330.49960.44220.42051.60512.50573.00062.67660.6388
TATA -0.0315-0.0731-0.0357-0.0521-0.0642-0.068-0.0177-0.01990.0381-0.0237
M-score 16.36-2.79-2.39-2.70-3.53-3.11-3.16-3.14-2.77-2.37
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