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Winmark Corp (NAS:WINA)
Beneish M-Score
-2.73 (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 -2.73 suggests that the company is not a manipulator.

WINA' s Beneish M-Score Range Over the Past 10 Years
Min: -5.91   Max: 3.59
Current: -2.73

-5.91
3.59

During the past 13 years, the highest Beneish M-Score of Winmark Corp was 3.59. The lowest was -5.91. And the median was -2.87.


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 * 0.8664+0.528 * 1.0029+0.404 * 1.0794+0.892 * 0.947+0.115 * 0.7766
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9286+4.679 * -0.0398-0.327 * 0.7391
=-2.73

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $2.16 Mil.
Revenue was 16.3 + 16.18 + 16.948 + 16 = $65.43 Mil.
Gross Profit was 15.712 + 15.483 + 16.35 + 15.288 = $62.83 Mil.
Total Current Assets was $20.80 Mil.
Total Assets was $42.82 Mil.
Property, Plant and Equipment(Net PPE) was $0.94 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.44 Mil.
Selling, General & Admin. Expense(SGA) was $26.45 Mil.
Total Current Liabilities was $7.17 Mil.
Long-Term Debt was $51.42 Mil.
Net Income was 5.394 + 4.563 + 5.654 + 5.34 = $20.95 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 2.549 + 10.607 + 4.136 + 5.364 = $22.66 Mil.
Accounts Receivable was $2.63 Mil.
Revenue was 15.477 + 21.024 + 16.183 + 16.404 = $69.09 Mil.
Gross Profit was 14.831 + 20.326 + 15.719 + 15.662 = $66.54 Mil.
Total Current Assets was $23.34 Mil.
Total Assets was $45.29 Mil.
Property, Plant and Equipment(Net PPE) was $1.29 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.42 Mil.
Selling, General & Admin. Expense(SGA) was $30.08 Mil.
Total Current Liabilities was $11.86 Mil.
Long-Term Debt was $72.00 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)
=(2.158 / 65.428) / (2.63 / 69.088)
=0.03298282 / 0.03806739
=0.8664

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)
=(66.538 / 69.088) / (62.833 / 65.428)
=0.96309055 / 0.96033808
=1.0029

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 - (20.797 + 0.936) / 42.818) / (1 - (23.335 + 1.294) / 45.29)
=0.49243309 / 0.45619342
=1.0794

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
=65.428 / 69.088
=0.947

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))
=(0.424 / (0.424 + 1.294)) / (0.436 / (0.436 + 0.936))
=0.2467986 / 0.31778426
=0.7766

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)
=(26.448 / 65.428) / (30.075 / 69.088)
=0.4042306 / 0.43531438
=0.9286

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)
=((51.422 + 7.169) / 42.818) / ((72 + 11.855) / 45.29)
=1.36837311 / 1.85151248
=0.7391

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
=(20.951 - 0 - 22.656) / 42.818
=-0.0398

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 -2.73 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

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.16630.92131.08680.58560.06997.74910.01580.79890.91090.3915
GMI 0.94940.98980.92531.03950.96780.95021.00460.98871.00340.9952
AQI 1.02381.04950.79550.69481.29480.92911.13430.73681.14871.0145
SGI 1.02931.13861.13671.05281.10481.24591.01181.07291.09781.1352
DEPI 1.08660.82520.73221.93671.07890.84410.94151.09331.05890.8076
SGAI 1.02460.99731.0720.75090.88051.04160.90271.00470.9741.0339
LVGI 3.84551.35110.93890.61920.81290.4492.89180.42052.26733.3729
TATA -0.0511-0.05-0.0806-0.136-0.043-0.1067-0.0325-0.06440.0381-0.0105
M-score -3.48-2.78-2.80-3.28-3.253.55-4.08-2.81-2.64-3.77

Winmark Corp Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.80970.85260.9290.91090.95461.99961.67630.39151.18540.8664
GMI 0.99710.98080.98480.98670.98610.99370.99170.99521.00331.0029
AQI 0.95110.90791.12091.14870.99041.01121.03211.01450.95891.0794
SGI 1.07281.03741.06681.09781.1841.20891.16881.13520.9550.947
DEPI 1.13681.23241.31811.05911.00520.87980.82760.80480.78480.7766
SGAI 1.00781.02981.0311.01191.0531.03211.01421.03390.95350.9286
LVGI 1.60512.50573.00062.26730.63882.84962.71783.37294.09460.7391
TATA -0.068-0.0177-0.01990.0381-0.0237-0.02540.0221-0.0106-0.0195-0.0398
M-score -3.11-3.18-3.16-2.65-2.37-2.12-2.18-3.77-3.48-2.73
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