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YRC Worldwide Inc (NAS:YRCW)
Beneish M-Score
-2.74 (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 -2.74 suggests that the company is not a manipulator.

YRCW' s 10-Year Beneish M-Score Range
Min: -5.32   Max: 2.68
Current: -2.74

-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 -2.75.


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 * 0.9222+0.528 * 0.9634+0.404 * 1.2496+0.892 * 0.9992+0.115 * 0.9441
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9961+4.679 * -0.0568-0.327 * 1.0074
=-2.74

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

This Year (Jun15) TTM:Last Year (Jun14) TTM:
Accounts Receivable was $513 Mil.
Revenue was 1258.4 + 1186.4 + 1217.7 + 1322.6 = $4,985 Mil.
Gross Profit was 877.6 + 824.8 + 825.9 + 880.2 = $3,409 Mil.
Total Current Assets was $807 Mil.
Total Assets was $1,969 Mil.
Property, Plant and Equipment(Net PPE) was $949 Mil.
Depreciation, Depletion and Amortization(DDA) was $165 Mil.
Selling, General & Admin. Expense(SGA) was $2,858 Mil.
Total Current Liabilities was $606 Mil.
Long-Term Debt was $1,069 Mil.
Net Income was 26 + -21.6 + 6.2 + 1.2 = $12 Mil.
Non Operating Income was -0.7 + 3.7 + 2.8 + 2.7 = $9 Mil.
Cash Flow from Operations was 56.9 + -25.8 + 54.8 + 29.3 = $115 Mil.
Accounts Receivable was $557 Mil.
Revenue was 1317.6 + 1210.9 + 1207.7 + 1252.7 = $4,989 Mil.
Gross Profit was 865.8 + 795.3 + 795.9 + 829.3 = $3,286 Mil.
Total Current Assets was $960 Mil.
Total Assets was $2,180 Mil.
Property, Plant and Equipment(Net PPE) was $1,031 Mil.
Depreciation, Depletion and Amortization(DDA) was $167 Mil.
Selling, General & Admin. Expense(SGA) was $2,871 Mil.
Total Current Liabilities was $758 Mil.
Long-Term Debt was $1,083 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)
=(512.9 / 4985.1) / (556.6 / 4988.9)
=0.1028866 / 0.11156768
=0.9222

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)
=(824.8 / 4988.9) / (877.6 / 4985.1)
=0.65872236 / 0.68373754
=0.9634

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 - (806.8 + 948.6) / 1968.6) / (1 - (959.5 + 1031.1) / 2179.5)
=0.10830031 / 0.08667125
=1.2496

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
=4985.1 / 4988.9
=0.9992

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))
=(167.2 / (167.2 + 1031.1)) / (164.5 / (164.5 + 948.6))
=0.139531 / 0.14778546
=0.9441

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)
=(2857.6 / 4985.1) / (2871 / 4988.9)
=0.57322822 / 0.57547756
=0.9961

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)
=((1069.4 + 606.4) / 1968.6) / ((1083.4 + 758.3) / 2179.5)
=0.85126486 / 0.84501032
=1.0074

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
=(11.8 - 8.5 - 115.2) / 1968.6
=-0.0568

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 -2.74 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 1.15780.92970.83881.04291.04550.95930.96860.99870.9799
GMI 1.094201.05481.02090.95211.04830.96731.00211.0012
AQI 1.1270.72110.29811.43320.96111.18380.93280.73451.4036
SGI 1.29170.970.92920.59090.82051.12320.99621.00311.0418
DEPI 1.05441.11150.90450.87991.05040.90830.95550.9790.9661
SGAI 0.91921.03190.98761.19170.88790.92690.99411.00290.9935
LVGI 1.0961.15521.33581.00591.11551.13581.08411.06560.9023
TATA -0.0254-0.2032-0.3027-0.1313-0.1192-0.1035-0.04-0.0493-0.0589
M-score -2.10-4.21-4.48-3.28-3.21-2.83-2.78-2.84-2.54

YRC Worldwide Inc Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
DSRI 1.05791.06231.01560.99871.04031.0231.01420.97990.93740.9222
GMI 0.96430.97510.98931.00211.01331.01731.01081.00120.98270.9634
AQI 0.88420.87690.51820.73450.82960.79351.21551.40361.30881.2496
SGI 0.97540.9750.98611.00311.01971.03711.04821.04181.02660.9992
DEPI 0.99311.00411.01130.9790.96310.95530.96650.96610.95160.9441
SGAI 0.99770.98920.99631.00291.01091.00441.00170.99350.98610.9961
LVGI 1.07311.07321.07111.06560.93190.92960.91420.90231.02441.0074
TATA -0.0142-0.0086-0.0528-0.0493-0.0547-0.0515-0.0407-0.0589-0.0438-0.0568
M-score -2.61-2.57-2.95-2.84-2.73-2.72-2.50-2.54-2.61-2.74
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