Aurora Cannabis (Aurora Cannabis) Beneish M-Score

: -3.09 (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 -3.09 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

ACB' s Beneish M-Score Range Over the Past 10 Years
Min: -8.08 Med: -2.02 Max: 85.23
Current: -3.09

During the past 13 years, the highest Beneish M-Score of Aurora Cannabis was 85.23. The lowest was -8.08. And the median was -2.02.

Aurora Cannabis Beneish M-Score Historical Data

The historical data trend for Aurora Cannabis'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.

Aurora Cannabis Annual Data

Trend

Jun12

Jun13

Jun14

Jun15

Jun16

Jun17

Jun18

Jun19

Jun20

Jun21

Beneish M-Score

10.38

1.22

1.28

-8.08

-2.56

Aurora Cannabis Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Beneish M-Score																-3.50	-0.59	-2.57	-2.86	-3.09

Competitive Comparison

For the Drug Manufacturers - Specialty & Generic subindustry, Aurora Cannabis'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.

Aurora Cannabis Beneish M-Score Distribution

For the Drug Manufacturers industry and Healthcare sector, Aurora Cannabis's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Aurora Cannabis's Beneish M-Score falls into.

Aurora Cannabis 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 Aurora Cannabis for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 0.7467

0.528 * -0.3541

0.404 * 0.8868

0.892 * 1.2282

0.115 * 1.6057

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.6808

4.679 * -0.006695

0.327 * 0.71

-3.08

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was $32.3 Mil.
Revenue was 48.017 + 46.869 + 56.533 + 46.792 = $198.2 Mil.
Gross Profit was 14.761 + 25.459 + 18.843 + 13.632 = $72.7 Mil.
Total Current Assets was $303.0 Mil.
Total Assets was $609.1 Mil.
Property, Plant and Equipment(Net PPE) was $220.4 Mil.
Depreciation, Depletion and Amortization(DDA) was $27.2 Mil.
Selling, General, & Admin. Expense(SGA) was $117.1 Mil.
Total Current Liabilities was $80.0 Mil.
Long-Term Debt & Capital Lease Obligation was $58.4 Mil.
Net Income was -18.261 + -1.572 + -21.324 + -59.929 = $-101.1 Mil.
Non Operating Income was -2.769 + -0.519 + -3.339 + -37.61 = $-44.2 Mil.
Cash Flow from Operations was -3.924 + -22.823 + -8.458 + -17.566 = $-52.8 Mil.

Total Receivables was $35.2 Mil.
Revenue was 45.402 + 36.932 + 39.218 + 39.837 = $161.4 Mil.
Gross Profit was -11.903 + -1.28 + 3.429 + -11.208 = $-21.0 Mil.
Total Current Assets was $399.6 Mil.
Total Assets was $753.7 Mil.
Property, Plant and Equipment(Net PPE) was $234.5 Mil.
Depreciation, Depletion and Amortization(DDA) was $50.3 Mil.
Selling, General, & Admin. Expense(SGA) was $140.0 Mil.
Total Current Liabilities was $97.9 Mil.
Long-Term Debt & Capital Lease Obligation was $143.3 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)
	=	(32.288 / 198.211)	/	(35.207 / 161.389)
	=	0.162897	/	0.21815
	=	0.7467

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)
	=	(-20.962 / 161.389)	/	(72.695 / 198.211)
	=	-0.129885	/	0.366756
	=	-0.3541

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 - (303.019 + 220.364) / 609.099)	/	(1 - (399.552 + 234.509) / 753.651)
	=	0.140726	/	0.158681
	=	0.8868

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
	=	198.211	/	161.389
	=	1.2282

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))
	=	(50.28 / (50.28 + 234.509))	/	(27.222 / (27.222 + 220.364))
	=	0.176552	/	0.10995
	=	1.6057

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)
	=	(117.065 / 198.211)	/	(140.005 / 161.389)
	=	0.590608	/	0.8675
	=	0.6808

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)
	=	((58.409 + 80.037) / 609.099)	/	((143.324 + 97.948) / 753.651)
	=	0.227296	/	0.320138
	=	0.71

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
	=	(-101.086 - -44.237	-	-52.771)	/	609.099
	=	-0.006695

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.

Aurora Cannabis has a M-score of -3.08 suggests that the company is unlikely to be a manipulator.

Aurora Cannabis Beneish M-Score Related Terms

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Aurora Cannabis (Aurora Cannabis) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Drug Manufacturers » Aurora Cannabis Inc (NAS:ACB) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

21P1:Germany ACB:Canada

Address

3498 63 Avenue, Leduc, AB, CAN, T9E 0G8

Website

https://www.auroramj.com

Aurora Cannabis, headquartered in Edmonton, Canada, cultivates and sells medicinal and recreational cannabis through a portfolio of brands that includes Drift, San Rafael '71, Daily Special, Whistler, Being, and Greybeard. Although the company primarily operates in Canada, it has expanded internationally through medical cannabis exporting agreements.