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GuruFocus has detected 4 Warning Signs with Cabela's Inc $CAB.
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Cabela's Inc (NYSE:CAB)
Beneish M-Score
-2.92 (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.

Cabela's Inc has a M-score of -2.92 suggests that the company is not a manipulator.

CAB' s Beneish M-Score Range Over the Past 10 Years
Min: -3.71   Max: -1.76
Current: -2.92

-3.71
-1.76

During the past 13 years, the highest Beneish M-Score of Cabela's Inc was -1.76. The lowest was -3.71. And the median was -2.56.


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 Cabela's 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 * 0.823+0.528 * 1.0351+0.404 * 0.7173+0.892 * 1.0159+0.115 * 0.8852
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9929+4.679 * -0.0441-0.327 * 0.9332
=-2.92

* 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 $30 Mil.
Revenue was 834.889 + 1338.305 + 996.495 + 929.897 = $4,100 Mil.
Gross Profit was 368.777 + 520.482 + 407.025 + 398.35 = $1,695 Mil.
Total Current Assets was $6,628 Mil.
Total Assets was $8,550 Mil.
Property, Plant and Equipment(Net PPE) was $1,797 Mil.
Depreciation, Depletion and Amortization(DDA) was $153 Mil.
Selling, General & Admin. Expense(SGA) was $1,413 Mil.
Total Current Liabilities was $2,188 Mil.
Long-Term Debt was $3,137 Mil.
Net Income was 19.063 + 58.059 + 28.24 + 37.759 = $143 Mil.
Non Operating Income was 0.569 + 0.58 + 0.88 + 2.78 = $5 Mil.
Cash Flow from Operations was 75.083 + 222.808 + 65.369 + 151.833 = $515 Mil.
Accounts Receivable was $35 Mil.
Revenue was 864.662 + 1407.827 + 926.523 + 836.276 = $4,035 Mil.
Gross Profit was 376.517 + 554.822 + 412.029 + 383.282 = $1,727 Mil.
Total Current Assets was $6,096 Mil.
Total Assets was $8,101 Mil.
Property, Plant and Equipment(Net PPE) was $1,841 Mil.
Depreciation, Depletion and Amortization(DDA) was $137 Mil.
Selling, General & Admin. Expense(SGA) was $1,401 Mil.
Total Current Liabilities was $2,480 Mil.
Long-Term Debt was $2,927 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)
=(29.64 / 4099.586) / (35.45 / 4035.288)
=0.00723 / 0.008785
=0.823

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)
=(1726.65 / 4035.288) / (1694.634 / 4099.586)
=0.42788767 / 0.41336711
=1.0351

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 - (6628.404 + 1796.668) / 8549.949) / (1 - (6095.72 + 1840.53) / 8101.209)
=0.01460558 / 0.02036227
=0.7173

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
=4099.586 / 4035.288
=1.0159

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))
=(137.185 / (137.185 + 1840.53)) / (152.751 / (152.751 + 1796.668))
=0.0693654 / 0.07835719
=0.8852

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)
=(1412.98 / 4099.586) / (1400.732 / 4035.288)
=0.34466407 / 0.3471207
=0.9929

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)
=((3137.407 + 2187.522) / 8549.949) / ((2926.697 + 2479.84) / 8101.209)
=0.62280243 / 0.66737409
=0.9332

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
=(143.121 - 4.809 - 515.093) / 8549.949
=-0.0441

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.

Cabela's Inc has a M-score of -2.92 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.

Cabela's Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 1.08830.89940.67621.46180.94560.88310.80441.43551.16080.9292
GMI 1.00721.04211.0140.95770.95850.98770.98991.00151.01691.038
AQI 0.86151.03721.35390.27120.82150.78910.70391.00211.16790.7187
SGI 1.13861.08641.03121.01181.05551.10731.15641.01341.0961.0329
DEPI 1.13630.90820.8551.01621.0351.05611.07611.01830.96260.8898
SGAI 1.00680.97160.97481.0171.00950.99090.99251.02771.01180.9867
LVGI 1.0580.8260.94981.56510.85281.09140.97451.11311.01880.9426
TATA 0.0222-0.0356-0.1009-0.0138-0.045-0.0117-0.0195-0.0083-0.018-0.0361
M-score -2.23-2.57-3.07-2.61-2.73-2.66-2.72-2.14-2.27-2.77

Cabela's Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 1.43551.03181.08291.04891.16081.07281.23440.92440.92920.823
GMI 1.00151.00711.01451.01211.01691.01621.02891.051.0381.0351
AQI 1.00210.89590.8240.92321.16791.21571.25971.25140.71870.7173
SGI 1.01341.06421.08411.08481.0961.07641.07971.08651.03291.0159
DEPI 1.01831.01311.0131.00810.96260.95580.89540.87790.88980.8852
SGAI 1.02770.9991.00551.03451.01181.00840.98280.96780.98670.9929
LVGI 1.11311.05971.05651.01151.01881.01170.97090.97120.94260.9332
TATA -0.0083-0.0163-0.0134-0.0164-0.018-0.0222-0.029-0.0452-0.0361-0.0441
M-score -2.14-2.53-2.47-2.47-2.27-2.36-2.21-2.56-2.77-2.92
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