# Elevance Health (Elevance Health) Beneish M-Score : -2.93 (As of May. 23, 2024)

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## What is Elevance Health Beneish M-Score?

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.93 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Elevance Health's Beneish M-Score or its related term are showing as below:

ELV' s Beneish M-Score Range Over the Past 10 Years
Min: -3.37   Med: -2.56   Max: -2.2
Current: -2.93

During the past 13 years, the highest Beneish M-Score of Elevance Health was -2.20. The lowest was -3.37. And the median was -2.56.

## Elevance Health Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Elevance Health 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 * 1.0242 + 0.528 * 1 + 0.404 * 1.0008 + 0.892 * 1.0689 + 0.115 * 1.0788 - 0.172 * SGAI + 4.679 * TATA - 0.327 * LVGI - 0.172 * 0.2484 + 4.679 * -0.154208 - 0.327 * 0.8498 = -2.93

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

 This Year (Mar24) TTM: Last Year (Mar23) TTM: Total Receivables was \$18,293 Mil. Revenue was 42577 + 42647 + 42849 + 43672 = \$171,745 Mil. Gross Profit was 42577 + 42647 + 42849 + 43672 = \$171,745 Mil. Total Current Assets was \$0 Mil. Total Assets was \$111,894 Mil. Property, Plant and Equipment(Net PPE) was \$4,451 Mil. Depreciation, Depletion and Amortization(DDA) was \$1,614 Mil. Selling, General, & Admin. Expense(SGA) was \$4,818 Mil. Total Current Liabilities was \$0 Mil. Long-Term Debt & Capital Lease Obligation was \$21,976 Mil. Net Income was 2246 + 856 + 1289 + 1853 = \$6,244 Mil. Non Operating Income was 4499 + 5394 + 5177 + 4859 = \$19,929 Mil. Cash Flow from Operations was 1978 + -2971 + 2613 + 1950 = \$3,570 Mil. Total Receivables was \$16,710 Mil. Revenue was 42172 + 39929 + 39939 + 38632 = \$160,672 Mil. Gross Profit was 42172 + 39929 + 39939 + 38632 = \$160,672 Mil. Total Current Assets was \$0 Mil. Total Assets was \$109,040 Mil. Property, Plant and Equipment(Net PPE) was \$4,418 Mil. Depreciation, Depletion and Amortization(DDA) was \$1,779 Mil. Selling, General, & Admin. Expense(SGA) was \$18,148 Mil. Total Current Liabilities was \$0 Mil. Long-Term Debt & Capital Lease Obligation was \$25,201 Mil.

1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total 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) = (18293 / 171745) / (16710 / 160672) = 0.106513 / 0.104001 = 1.0242

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) = (160672 / 160672) / (171745 / 171745) = 1 / 1 = 1

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 Property, Plant and Equipment to Total Assets.

 AQI = (1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1) = (1 - (0 + 4451) / 111894) / (1 - (0 + 4418) / 109040) = 0.960221 / 0.959483 = 1.0008

4. SGI = Sales Growth Index

Ratio of Revenue 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 = 171745 / 160672 = 1.0689

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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)) = (1779 / (1779 + 4418)) / (1614 / (1614 + 4451)) = 0.287074 / 0.266117 = 1.0788

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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) = (4818 / 171745) / (18148 / 160672) = 0.028053 / 0.112951 = 0.2484

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 in leverage

 LVGI = ((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1) = ((21976 + 0) / 111894) / ((25201 + 0) / 109040) = 0.1964 / 0.231117 = 0.8498

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 = (6244 - 19929 - 3570) / 111894 = -0.154208

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Elevance Health has a M-score of -2.93 suggests that the company is unlikely to be a manipulator.

## Elevance Health Beneish M-Score Related Terms

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## Elevance Health (Elevance Health) Business Description

Industry
Comparable Companies
Traded in Other Exchanges
Address
220 Virginia Avenue, Indianapolis, IN, USA, 46204
Elevance Health remains one of the leading health insurers in the U.S., providing medical benefits to 48 million medical members as of June 2023. The company offers employer, individual, and government-sponsored coverage plans. Elevance differs from its peers in its unique position as the largest single provider of Blue Cross Blue Shield branded coverage, operating as the licensee for the Blue Cross Blue Shield Association in 14 states. Through acquisitions, such as the Amerigroup deal in 2012 and MMM in 2021, Elevance's reach expands beyond those states through government-sponsored programs such as Medicaid and Medicare Advantage plans, too.
Executives
 Blair Williams Todt officer: EVP and Chief Legal Officer 8735 HENDERSON ROAD, TAMPA FL 33625 Ronald W Penczek officer: SVP, Chief Accounting Officer 120 MONUMENT CIRCLE, INDIANAPOLIS IN 46204 Mark Kaye officer: EVP & CFO Designate 7 WORLD TRADE CENTER, 250 GREENWICH ST, NEW YORK NY 10007 Dixon Robert L Jr director 120 MONUMENT CIRCLE, INDIANAPOLIS IN 46204 Gloria M Mccarthy officer: EVP, Office of the CEO WELLPOINT, INC, 120 MONUMENT CIRCLE, INDIANAPOLIS IN 46204 Kendrick Charles Morgan Jr officer: EVP & President, Commercial 220 VIRGINIA AVE, INDIANAPOLIS IN 46204 Deanna D Strable-soethout director C/O PRINCIPAL FINANCIAL GROUP, 711 HIGH ST., DES MOINES IA 50392 Ramiro G Peru director WELLPOINT, INC, 120 MONUMENT CIRCLE, INDIANAPOLIS IN 46260 Peter D Haytaian officer: EVP & Pres., Govt. Bus. Div. 220 VIRGINIA AVE, INDIANAPOLIS IN 46204 Susan D. Devore director C/O PREMIER, INC., 13034 BALLANTYNE CORPORATE PLACE, CHARLOTTE NC 28277 Ryan M. Schneider director 1680 CAPITAL ONE DRIVE, MCLEAN VA 22102 John E Gallina officer: SVP & Chief Accounting Officer 120 MONUMENT CIRCLE, INDIANAPOLIS IN 46204 Julie A Hill director WELLPOINT, INC, 120 MONUMENT CIRCLE, INDIANAPOLIS IN 46204 Thomas C Zielinski officer: EVP & General Counsel Jeffrey D. Alter officer: EVP, IngenioRx & Anthem Health 4330 LA JOLLA VILLAGE DRIVE, SUITE 200, SAN DIEGO CA 92122