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Cognizant Technology Solutions Beneish M-Score

: -2.46 (As of Today)
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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 -2.46 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

CTSH' s Beneish M-Score Range Over the Past 10 Years
Min: -3.35   Med: -2.39   Max: -0.54
Current: -2.46

During the past 13 years, the highest Beneish M-Score of Cognizant Technology Solutions was -0.54. The lowest was -3.35. And the median was -2.39.


Cognizant Technology Solutions Beneish M-Score Historical Data

The historical data trend for Cognizant Technology Solutions's Beneish M-Score can be seen below:

* 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.

* Premium members only.

Cognizant Technology Solutions Annual Data
Trend Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21
Beneish M-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.63 -2.51 -2.54 -2.93 -2.43

Cognizant Technology Solutions Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.54 -2.48 -2.43 -2.46 -2.46

Competitive Comparison

For the Information Technology Services subindustry, Cognizant Technology Solutions's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Cognizant Technology Solutions Beneish M-Score Distribution

For the Software industry and Technology sector, Cognizant Technology Solutions's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Cognizant Technology Solutions's Beneish M-Score falls into.



Cognizant Technology Solutions 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 Cognizant Technology Solutions 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 * 1.0012+0.528 * 1.0144+0.404 * 0.9821+0.892 * 1.1057+0.115 * 0.9245
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9456+4.679 * -0.0198-0.327 * 0.9413
=-2.46

* 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 (Jun22) TTM:Last Year (Jun21) TTM:
Total Receivables was $3,785 Mil.
Revenue was 4906 + 4826 + 4777 + 4744 = $19,253 Mil.
Gross Profit was 1787 + 1729 + 1747 + 1797 = $7,060 Mil.
Total Current Assets was $7,023 Mil.
Total Assets was $17,258 Mil.
Property, Plant and Equipment(Net PPE) was $2,028 Mil.
Depreciation, Depletion and Amortization(DDA) was $575 Mil.
Selling, General, & Admin. Expense(SGA) was $3,540 Mil.
Total Current Liabilities was $3,153 Mil.
Long-Term Debt & Capital Lease Obligation was $1,355 Mil.
Net Income was 577 + 563 + 576 + 544 = $2,260 Mil.
Non Operating Income was -5 + 1 + 0 + -2 = $-6 Mil.
Cash Flow from Operations was 528 + 306 + 825 + 948 = $2,607 Mil.
Total Receivables was $3,419 Mil.
Revenue was 4585 + 4401 + 4184 + 4243 = $17,413 Mil.
Gross Profit was 1722 + 1637 + 1522 + 1596 = $6,477 Mil.
Total Current Assets was $6,451 Mil.
Total Assets was $16,829 Mil.
Property, Plant and Equipment(Net PPE) was $2,229 Mil.
Depreciation, Depletion and Amortization(DDA) was $572 Mil.
Selling, General, & Admin. Expense(SGA) was $3,386 Mil.
Total Current Liabilities was $3,183 Mil.
Long-Term Debt & Capital Lease Obligation was $1,487 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)
=(3785 / 19253) / (3419 / 17413)
=0.19659274 / 0.19634756
=1.0012

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)
=(6477 / 17413) / (7060 / 19253)
=0.37196348 / 0.3666961
=1.0144

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 - (7023 + 2028) / 17258) / (1 - (6451 + 2229) / 16829)
=0.47554757 / 0.48422366
=0.9821

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
=19253 / 17413
=1.1057

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))
=(572 / (572 + 2229)) / (575 / (575 + 2028))
=0.20421278 / 0.22089896
=0.9245

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)
=(3540 / 19253) / (3386 / 17413)
=0.18386745 / 0.19445242
=0.9456

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)
=((1355 + 3153) / 17258) / ((1487 + 3183) / 16829)
=0.26121219 / 0.27749718
=0.9413

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
=(2260 - -6 - 2607) / 17258
=-0.0198

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.

Cognizant Technology Solutions has a M-score of -2.46 suggests that the company is unlikely to be a manipulator.


Cognizant Technology Solutions Beneish M-Score Related Terms

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Cognizant Technology Solutions Business Description

Cognizant Technology Solutions logo
Address
300 Frank W. Burr Boulevard, Suite 36, 6th Floor, Teaneck, NJ, USA, 07666
Cognizant is a global IT services provider, offering consulting and outsourcing services to some of the world's largest enterprises spanning the financial services, media and communications, healthcare, natural resources, and consumer products industries. Cognizant employs nearly 300,000 people globally, roughly 70% of whom are in India, although the company's headquarters are in Teaneck, New Jersey.
Executives
Rohleder Stephen J director C/O ACCENTURE 161 N. CLARK STREET CHICAGO IL 60601
Nambiar Rajesh officer: President, Digital Business 300 FRANK W. BURR BLVD STE. 36, 6TH FL. TEANECK NJ 07666
Wijnberg Sandra S director 100 E. PRATT STREET BA-1320 BALTIMORE MD 21202
Abdalla Zein director 700 ANDERSON HILL ROAD LEGAL DEPARTMENT, 1/2 PURCHASE NY 10577
Velli Joseph M director
Mackay Leo S. Jr. director C/O COGNIZANT TECHNOLOGY SOLUTIONS CORP. 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Dineen John M. director MERRIMACK PHARMACEUTICALS, INC. ONE KENDALL SQUARE, SUITE B7201 CAMBRIDGE MA 02139
Kim John Sunshin officer: EVP & General Counsel 300 FRANK W. BURR BLVD., STE. 36, 6FL. TEANECK NJ 07666
Deskus Archana director 2929 ALLEN PARKWAY SUITE 2100 HOUSTON TX 77019
Bali Vinita director C/O BUNGE LIMITED 50 MAIN STREET, 6TH FLOOR WHITE PLAINS NY 10606
Patsalos-fox Michael director 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Morgenstern Ursula officer: President, Global Markets 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Breakiron-evans Maureen director C/O COGNIZANT TECHNOLOGY SOLUTIONS CORP. 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Stafford Andrew J officer: EVP, Head of Global Delivery C/O COGNIZANT TECHNOLOGY SOLUTIONS CORP. 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666
Hyttenrauch Gregory Lawrence officer: President, Digital Sys & Tech 300 FRANK W. BURR BLVD., STE. 36, 6 FL. TEANECK NJ 07666

Cognizant Technology Solutions Headlines

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