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GuruFocus has detected 3 Warning Signs with Coca-Cola Femsa SAB de CV $KOF.
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Coca-Cola Femsa SAB de CV (NYSE:KOF)
Beneish M-Score
0.00 (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.

Coca-Cola Femsa SAB de CV has a M-score of signals that the company is a manipulator.

During the past 13 years, the highest Beneish M-Score of Coca-Cola Femsa SAB de CV was 3.06. The lowest was -3.45. And the median was -2.25.


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 Coca-Cola Femsa SAB de CV 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 * +0.528 * +0.404 * +0.892 * +0.115 *
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * +4.679 * -0.327 *
=

* 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 $598 Mil.
Revenue was 2663.74481328 + 2784.98673119 + 2200.78363716 + 2141.0650913 = $9,791 Mil.
Gross Profit was 1156.48340249 + 1218.77926943 + 980.949510487 + 988.752961863 = $4,345 Mil.
Total Current Assets was $2,526 Mil.
Total Assets was $14,810 Mil.
Property, Plant and Equipment(Net PPE) was $4,124 Mil.
Depreciation, Depletion and Amortization(DDA) was $0 Mil.
Selling, General & Admin. Expense(SGA) was $3,064 Mil.
Total Current Liabilities was $2,453 Mil.
Long-Term Debt was $4,099 Mil.
Net Income was 305.342323651 + 170.201763971 + 117.701469579 + 107.270368504 = $701 Mil.
Non Operating Income was 184.128630705 + -26.2937090228 + -46.457003887 + -76.5527667285 = $35 Mil.
Cash Flow from Operations was 0 + 0 + 0 + 0 = $0 Mil.
Accounts Receivable was $478 Mil.
Revenue was 2104.16158545 + 2510.1349768 + 2236.57408232 + 2361.23313866 = $9,212 Mil.
Gross Profit was 959.427803271 + 1193.58391526 + 1065.04658911 + 1130.03255982 = $4,348 Mil.
Total Current Assets was $2,506 Mil.
Total Assets was $12,331 Mil.
Property, Plant and Equipment(Net PPE) was $2,883 Mil.
Depreciation, Depletion and Amortization(DDA) was $0 Mil.
Selling, General & Admin. Expense(SGA) was $2,926 Mil.
Total Current Liabilities was $2,084 Mil.
Long-Term Debt was $3,627 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)
=(597.510373444 / 9790.58027292) / (477.983925401 / 9212.10378324)
=0.06102911 / 0.05188651
=

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)
=(4348.09086746 / 9212.10378324) / (4344.96514427 / 9790.58027292)
=0.4719976 / 0.44379036
=

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 - (2526.08921162 + 4123.75518672) / 14810.2178423) / (1 - (2506.48032081 + 2882.70761133) / 12330.5332297)
=0.55099618 / 0.56293959
=

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
=9790.58027292 / 9212.10378324
=

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))
=(0 / (0 + 2882.70761133)) / (0 / (0 + 4123.75518672))
=0 / 0
=

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)
=(3063.62319731 / 9790.58027292) / (2926.32350572 / 9212.10378324)
=0.31291539 / 0.31766072
=

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)
=((4099.37759336 + 2453.16390041) / 14810.2178423) / ((3627.44819997 + 2083.79891437) / 12330.5332297)
=0.44243384 / 0.46317925
=

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
=(700.515925706 - 34.8251510671 - 0) / 14810.2178423
=0.0449

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.

Coca-Cola Femsa SAB de CV has a M-score of signals that the company is likely to 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.

Coca-Cola Femsa SAB de CV Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI
GMI
AQI
SGI
DEPI
SGAI
LVGI
TATA
M-score

Coca-Cola Femsa SAB de CV Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI
GMI
AQI
SGI
DEPI
SGAI
LVGI
TATA
M-score
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