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YRC Worldwide Inc (NAS:YRCW)
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.

YRC Worldwide Inc has a M-score of -2.73 suggests that the company is not a manipulator.

YRCW' s 10-Year Beneish M-Score Range
Min: -5.32   Max: 2.68
Current: -2.73

-5.32
2.68

During the past 13 years, the highest Beneish M-Score of YRC Worldwide Inc was 2.68. The lowest was -5.32. And the median was -2.80.


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 YRC Worldwide Inc 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 * 1.0403+0.528 * 1.0133+0.404 * 0.8296+0.892 * 1.0197+0.115 * 0.9632
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0109+4.679 * -0.0547-0.327 * 0.9319
=-2.73

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

This Year (Mar14) TTM:Last Year (Mar13) TTM:
Accounts Receivable was $536 Mil.
Revenue was 1210.9 + 1207.7 + 1252.7 + 1242.5 = $4,914 Mil.
Gross Profit was 795.3 + 795.9 + 829.3 + 831 = $3,252 Mil.
Total Current Assets was $949 Mil.
Total Assets was $2,215 Mil.
Property, Plant and Equipment(Net PPE) was $1,063 Mil.
Depreciation, Depletion and Amortization(DDA) was $170 Mil.
Selling, General & Admin. Expense(SGA) was $2,848 Mil.
Total Current Liabilities was $756 Mil.
Long-Term Debt was $1,098 Mil.
Net Income was -70.2 + 0.4 + -44.4 + -15.1 = $-129 Mil.
Non Operating Income was 16.3 + 3 + 0.2 + 2.5 = $22 Mil.
Cash Flow from Operations was -56.2 + 15.1 + 15.2 + -4.3 = $-30 Mil.
Accounts Receivable was $505 Mil.
Revenue was 1162.5 + 1168.6 + 1236.8 + 1250.8 = $4,819 Mil.
Gross Profit was 779.8 + 778 + 834.6 + 838.7 = $3,231 Mil.
Total Current Assets was $791 Mil.
Total Assets was $2,201 Mil.
Property, Plant and Equipment(Net PPE) was $1,167 Mil.
Depreciation, Depletion and Amortization(DDA) was $178 Mil.
Selling, General & Admin. Expense(SGA) was $2,763 Mil.
Total Current Liabilities was $680 Mil.
Long-Term Debt was $1,296 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)
=(535.7 / 4913.8) / (505 / 4818.7)
=0.1090195 / 0.10480005
=1.0403

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)
=(795.9 / 4818.7) / (795.3 / 4913.8)
=0.67053355 / 0.66170784
=1.0133

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 - (949.1 + 1063.2) / 2215.1) / (1 - (790.8 + 1167.2) / 2200.9)
=0.09155343 / 0.11036394
=0.8296

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
=4913.8 / 4818.7
=1.0197

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))
=(178.4 / (178.4 + 1167.2)) / (169.7 / (169.7 + 1063.2))
=0.13258026 / 0.13764296
=0.9632

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)
=(2847.8 / 4913.8) / (2762.6 / 4818.7)
=0.57955147 / 0.57330815
=1.0109

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)
=((1097.5 + 755.5) / 2215.1) / ((1296 + 679.7) / 2200.9)
=0.83653108 / 0.89767822
=0.9319

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
=(-129.3 - 22 - -30.2) / 2215.1
=-0.0547

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.

YRC Worldwide Inc 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.

YRC Worldwide Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 0.5051.15780.92970.83880.9711.1230.95930.96860.9987
GMI 1.01421.094201.05480.98530.98531.04970.96731.0021
AQI 0.93491.1270.72110.29811.51160.91121.18330.93320.7345
SGI 2.20541.29170.970.92920.54480.88991.12320.99621.0031
DEPI 0.54511.05441.11150.90450.87221.04850.91780.95560.979
SGAI 0.95780.91921.03190.98761.25150.84550.92680.99411.0029
LVGI 0.90091.0961.15521.33581.00591.11551.13571.08421.0656
TATA -0.0517-0.0254-0.2032-0.3027-0.1313-0.1205-0.1035-0.04-0.0493
M-score -2.13-2.10-4.21-4.48-3.39-3.08-2.83-2.78-2.84

YRC Worldwide Inc Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
DSRI 0.95930.88940.87530.91980.96861.05791.06231.01560.99871.0403
GMI 1.04971.03921.01560.99160.96730.96430.97510.98991.0021.0133
AQI 1.18331.24191.29891.18390.93320.88420.87690.51820.73450.8296
SGI 1.12321.10511.07061.03080.99620.97540.9750.98611.00311.0197
DEPI 0.91780.90910.90160.89620.95560.99070.99961.00450.9790.9632
SGAI 0.92680.97990.97950.98210.9940.99770.98930.99631.00291.0109
LVGI 1.13571.11491.09841.1491.08421.07311.07321.07111.06560.9319
TATA -0.1035-0.1089-0.1106-0.0722-0.04-0.0142-0.0086-0.0528-0.0493-0.0547
M-score -2.83-2.92-2.96-2.85-2.78-2.61-2.57-2.95-2.84-2.73
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