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GuruFocus has detected 2 Warning Signs with Bowl America Inc $BWL.A.
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Bowl America Inc (AMEX:BWL.A)
Beneish M-Score
-2.34 (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.

Bowl America Inc has a M-score of -2.34 suggests that the company is not a manipulator.

BWL.A' s Beneish M-Score Range Over the Past 10 Years
Min: -14.71   Max: 6.03
Current: -2.34

-14.71
6.03

During the past 13 years, the highest Beneish M-Score of Bowl America Inc was 6.03. The lowest was -14.71. And the median was -2.72.


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 Bowl America 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+0.528 * 0.9913+0.404 * 1.0782+0.892 * 1.0507+0.115 * 1.2494
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9426+4.679 * 0.0011-0.327 * 0.92
=-2.34

* 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 $0.00 Mil.
Revenue was 7.491 + 6.235 + 5.064 + 5.75 = $24.54 Mil.
Gross Profit was 5.3 + 4.185 + 3.113 + 3.757 = $16.36 Mil.
Total Current Assets was $3.95 Mil.
Total Assets was $32.21 Mil.
Property, Plant and Equipment(Net PPE) was $18.93 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.97 Mil.
Selling, General & Admin. Expense(SGA) was $11.79 Mil.
Total Current Liabilities was $4.54 Mil.
Long-Term Debt was $0.00 Mil.
Net Income was 1.407 + 0.696 + -0.001 + 0.519 = $2.62 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was 2.46 + 1.775 + 0.084 + -1.733 = $2.59 Mil.
Accounts Receivable was $0.00 Mil.
Revenue was 7.421 + 6.006 + 4.92 + 5.009 = $23.36 Mil.
Gross Profit was 5.255 + 3.996 + 2.94 + 3.239 = $15.43 Mil.
Total Current Assets was $4.97 Mil.
Total Assets was $33.65 Mil.
Property, Plant and Equipment(Net PPE) was $19.64 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.28 Mil.
Selling, General & Admin. Expense(SGA) was $11.91 Mil.
Total Current Liabilities was $5.16 Mil.
Long-Term Debt was $0.00 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)
=(0 / 24.54) / (0 / 23.356)
=0 / 0
=1

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)
=(15.43 / 23.356) / (16.355 / 24.54)
=0.66064395 / 0.66646292
=0.9913

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 - (3.948 + 18.928) / 32.205) / (1 - (4.969 + 19.643) / 33.654)
=0.28967552 / 0.26867534
=1.0782

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
=24.54 / 23.356
=1.0507

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))
=(1.278 / (1.278 + 19.643)) / (0.973 / (0.973 + 18.928))
=0.06108695 / 0.04889202
=1.2494

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)
=(11.792 / 24.54) / (11.906 / 23.356)
=0.4805216 / 0.50976195
=0.9426

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 + 4.54) / 32.205) / ((0 + 5.157) / 33.654)
=0.1409719 / 0.15323587
=0.92

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
=(2.621 - 0 - 2.586) / 32.205
=0.0011

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.

Bowl America Inc has a M-score of -2.34 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.

Bowl America Inc Annual Data

Jun07Jun08Jun09Jun10Jun11Jun12Jun13Jun14Jun15Jun16
DSRI 0.202810.53511.17891.62880.44461.23930.18855.65170.16050
GMI 0.9851.01661.03291.03411.01020.98110.98421.02880.98280.9859
AQI 1.68860.86180.91771.08121.16771.13691.09831.12991.0611.0057
SGI 1.05460.94150.98690.9130.97760.9180.980.95491.01511.0421
DEPI 0.84051.04170.97630.99211.06561.05970.99431.02281.02861.0385
SGAI 0.99061.03960.99091.02971.03161.02481.00491.0080.97190.9595
LVGI 0.88931.07711.02440.94681.07540.98561.12421.04391.0381.1474
TATA -0.042-0.0063-0.0802-0.0264-0.0482-0.03410.0258-0.0199-0.0441-0.0405
M-score -3.076.14-2.73-2.04-3.19-2.44-3.131.72-3.43-3.59

Bowl America Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 2.268110.16050.23810.1779002.34580.74361
GMI 1.01040.99140.98270.97650.98030.98020.98590.98670.98660.9913
AQI 1.08511.0641.0610.91480.940.98011.00571.13441.12191.0782
SGI 0.97120.99431.01511.03341.03481.02121.04211.03531.04351.0507
DEPI 1.04831.02581.02860.98430.95290.95011.03761.09041.16181.2494
SGAI 1.00150.9880.97190.95920.95950.96950.95950.95990.95150.9426
LVGI 1.09351.04861.0381.05051.08891.12711.14741.14521.08880.92
TATA -0.0328-0.0323-0.0441-0.0449-0.0446-0.0477-0.0405-0.0238-0.020.0011
M-score -1.48-2.63-3.43-3.42-3.48-3.66-3.59-1.30-2.73-2.34
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