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GuruFocus has detected 3 Warning Signs with American Public Education Inc $APEI.
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American Public Education Inc (NAS:APEI)
Beneish M-Score
-3.04 (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.

American Public Education Inc has a M-score of -3.04 suggests that the company is not a manipulator.

APEI' s Beneish M-Score Range Over the Past 10 Years
Min: -3.37   Max: 2.86
Current: -3.04

-3.37
2.86

During the past 13 years, the highest Beneish M-Score of American Public Education Inc was 2.86. The lowest was -3.37. And the median was -3.00.


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 American Public Education 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 * 0.7755+0.528 * 1.0322+0.404 * 0.8871+0.892 * 0.9339+0.115 * 0.9658
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0345+4.679 * -0.0708-0.327 * 0.7665
=-3.04

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

This Year (Mar17) TTM:Last Year (Mar16) TTM:
Accounts Receivable was $6.2 Mil.
Revenue was 75.688 + 78.625 + 73.803 + 76.745 = $304.9 Mil.
Gross Profit was 46.732 + 48.58 + 45.446 + 47.559 = $188.3 Mil.
Total Current Assets was $165.6 Mil.
Total Assets was $320.3 Mil.
Property, Plant and Equipment(Net PPE) was $95.7 Mil.
Depreciation, Depletion and Amortization(DDA) was $19.2 Mil.
Selling, General & Admin. Expense(SGA) was $128.0 Mil.
Total Current Liabilities was $39.8 Mil.
Long-Term Debt was $0.0 Mil.
Net Income was 4.509 + 6.893 + 0.326 + 6.596 = $18.3 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.0 Mil.
Cash Flow from Operations was 5.054 + 13.326 + 13.901 + 8.735 = $41.0 Mil.
Accounts Receivable was $8.6 Mil.
Revenue was 83.966 + 85.912 + 76.291 + 80.263 = $326.4 Mil.
Gross Profit was 54.258 + 56.187 + 47.124 + 50.567 = $208.1 Mil.
Total Current Assets was $141.2 Mil.
Total Assets was $314.4 Mil.
Property, Plant and Equipment(Net PPE) was $108.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $20.8 Mil.
Selling, General & Admin. Expense(SGA) was $132.5 Mil.
Total Current Liabilities was $51.0 Mil.
Long-Term Debt was $0.0 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)
=(6.2 / 304.861) / (8.56 / 326.432)
=0.02033714 / 0.02622292
=0.7755

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)
=(208.136 / 326.432) / (188.317 / 304.861)
=0.63760906 / 0.6177143
=1.0322

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 - (165.634 + 95.728) / 320.317) / (1 - (141.162 + 108.005) / 314.398)
=0.18405205 / 0.20747906
=0.8871

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
=304.861 / 326.432
=0.9339

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))
=(20.82 / (20.82 + 108.005)) / (19.239 / (19.239 + 95.728))
=0.16161459 / 0.16734367
=0.9658

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)
=(127.995 / 304.861) / (132.475 / 326.432)
=0.41984708 / 0.40582725
=1.0345

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 + 39.833) / 320.317) / ((0 + 51.006) / 314.398)
=0.12435494 / 0.16223386
=0.7665

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
=(18.324 - 0 - 41.016) / 320.317
=-0.0708

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.

American Public Education Inc has a M-score of -3.04 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.

American Public Education Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.8151.00690.89110.7040.91170.86870.60611.37860.9191
GMI 0.96610.97580.98090.97740.97810.98611.01751.01391.0194
AQI 0.95191.19140.55830.70768.12674.11080.841.06610.8719
SGI 1.55071.39061.331.31391.20411.05091.06230.93680.955
DEPI 0.9831.03591.28930.97831.14570.91520.95290.86020.9548
SGAI 0.98230.97241.09581.06771.1011.0470.99981.00280.989
LVGI 1.00340.9111.05911.07560.81320.86180.81090.95530.8499
TATA -0.1722-0.1107-0.1213-0.1492-0.0446-0.064-0.0676-0.0828-0.0993
M-score -3.00-2.54-3.04-3.340.34-1.58-3.10-2.54-3.05

American Public Education Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 0.60610.6670.67051.381.37860.98441.19380.68570.91910.7755
GMI 1.01751.01141.0111.01171.01391.01371.01141.00451.01941.0322
AQI 0.840.86880.85010.85441.06611.04371.00350.97640.87190.8871
SGI 1.06231.03811.00880.97550.93680.9410.9450.96140.9550.9339
DEPI 0.95290.96360.97610.96820.86020.85950.85590.82190.95480.9658
SGAI 0.99981.00091.0050.99371.00280.97960.9670.96530.9891.0345
LVGI 0.81090.80760.90451.01650.95531.08320.960.76150.84990.7665
TATA -0.0676-0.0549-0.0859-0.0714-0.0828-0.115-0.0944-0.0959-0.0993-0.0708
M-score -3.10-3.00-3.20-2.55-2.54-3.10-2.78-3.20-3.05-3.04
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