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Winmark Corp (NAS:WINA)
Beneish M-Score
-2.58 (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 -2.58 suggests that the company is not a manipulator.

WINA' s Beneish M-Score Range Over the Past 10 Years
Min: -5.91   Max: 207.8
Current: -2.58

-5.91
207.8

During the past 13 years, the highest Beneish M-Score of Winmark Corp was 207.80. The lowest was -5.91. And the median was -2.84.


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 * 1.1128+0.528 * 0.9993+0.404 * 1.0126+0.892 * 0.9633+0.115 * 0.7763
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.928+4.679 * -0.0544-0.327 * 0.7131
=-2.58

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was $2.33 Mil.
Revenue was 16.734 + 16.3 + 16.18 + 16.948 = $66.16 Mil.
Gross Profit was 16.235 + 15.712 + 15.483 + 16.35 = $63.78 Mil.
Total Current Assets was $20.97 Mil.
Total Assets was $43.50 Mil.
Property, Plant and Equipment(Net PPE) was $0.85 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.43 Mil.
Selling, General & Admin. Expense(SGA) was $26.37 Mil.
Total Current Liabilities was $7.43 Mil.
Long-Term Debt was $45.62 Mil.
Net Income was 6.094 + 5.394 + 4.563 + 5.654 = $21.71 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 6.78 + 2.549 + 10.607 + 4.136 = $24.07 Mil.
Accounts Receivable was $2.17 Mil.
Revenue was 16 + 15.477 + 21.024 + 16.183 = $68.68 Mil.
Gross Profit was 15.288 + 14.831 + 20.326 + 15.719 = $66.16 Mil.
Total Current Assets was $22.53 Mil.
Total Assets was $46.78 Mil.
Property, Plant and Equipment(Net PPE) was $1.22 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.43 Mil.
Selling, General & Admin. Expense(SGA) was $29.50 Mil.
Total Current Liabilities was $11.40 Mil.
Long-Term Debt was $68.60 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)
=(2.325 / 66.162) / (2.169 / 68.684)
=0.03514102 / 0.03157941
=1.1128

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)
=(66.164 / 68.684) / (63.78 / 66.162)
=0.96331023 / 0.96399746
=0.9993

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 - (20.97 + 0.848) / 43.496) / (1 - (22.534 + 1.219) / 46.775)
=0.49839066 / 0.492186
=1.0126

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
=66.162 / 68.684
=0.9633

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))
=(0.431 / (0.431 + 1.219)) / (0.43 / (0.43 + 0.848))
=0.26121212 / 0.33646322
=0.7763

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)
=(26.368 / 66.162) / (29.496 / 68.684)
=0.39853692 / 0.42944499
=0.928

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)
=((45.624 + 7.425) / 43.496) / ((68.603 + 11.398) / 46.775)
=1.21962939 / 1.71033672
=0.7131

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
=(21.705 - 0 - 24.072) / 43.496
=-0.0544

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 -2.58 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 local exchange's currency.

Winmark Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.16660.92131.08680.58560.06997.74910.01580.79890.9109230.3638
GMI 0.94920.98980.98260.97890.92750.99161.00460.98871.00340.9952
AQI 1.02381.04950.79550.69481.29480.92911.13430.73681.14871.0145
SGI 1.0291.13861.13671.05281.10481.24591.01181.07291.09781.1352
DEPI 1.08660.82520.73221.93671.07890.84410.94151.09331.05890.8076
SGAI 1.02490.99730.87490.92010.95730.9580.90271.00470.9741.0339
LVGI 3.84551.35110.93890.61920.81290.4492.89180.42052.26733.3729
TATA -0.0498-0.05-0.0806-0.136-0.043-0.1067-0.0325-0.06440.0381-0.0105
M-score -3.48-2.78-2.74-3.34-3.283.59-4.08-2.81-2.64207.81

Winmark Corp Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 0.85260.9290.91090.95461.99961.6763230.36051.18540.86641.1128
GMI 0.98080.98480.98670.98610.99370.99170.99521.00331.00290.9993
AQI 0.90791.12091.14870.99041.01121.03211.01450.95891.07941.0126
SGI 1.03741.06681.09781.1841.20891.16881.13520.9550.9470.9633
DEPI 1.23241.31811.05911.00520.87980.82760.80480.78480.77660.7763
SGAI 1.02981.0311.01191.0531.03211.01421.03390.95350.92860.928
LVGI 2.50573.00062.26730.63882.84962.71783.37294.09460.73910.7131
TATA -0.0177-0.01990.0381-0.0237-0.02540.0221-0.0106-0.0195-0.0398-0.0544
M-score -3.18-3.16-2.65-2.37-2.12-2.18207.80-3.48-2.73-2.58
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