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Brown-Forman (Brown-Forman) Beneish M-Score : -2.41 (As of Apr. 25, 2024)


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What is Brown-Forman Beneish M-Score?

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 -2.41 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

BF.A' s Beneish M-Score Range Over the Past 10 Years
Min: -2.66   Med: -2.39   Max: -1.95
Current: -2.41

During the past 13 years, the highest Beneish M-Score of Brown-Forman was -1.95. The lowest was -2.66. And the median was -2.39.


Brown-Forman Beneish M-Score Historical Data

The historical data trend for Brown-Forman'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.

Brown-Forman Beneish M-Score Chart

Brown-Forman Annual Data
Trend Apr14 Apr15 Apr16 Apr17 Apr18 Apr19 Apr20 Apr21 Apr22 Apr23
Beneish M-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only -2.43 -2.44 -2.20 -2.44 -2.14

Brown-Forman Quarterly Data
Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22 Jan23 Apr23 Jul23 Oct23 Jan24
Beneish M-Score Get a 7-Day Free Trial 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 -2.09 -2.14 -2.13 -2.06 -2.41

Competitive Comparison of Brown-Forman's Beneish M-Score

For the Beverages - Wineries & Distilleries subindustry, Brown-Forman'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.


Brown-Forman's Beneish M-Score Distribution in the Beverages - Alcoholic Industry

For the Beverages - Alcoholic industry and Consumer Defensive sector, Brown-Forman's Beneish M-Score distribution charts can be found below:

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



Brown-Forman 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 Brown-Forman 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 * 0.9122+0.528 * 0.9775+0.404 * 0.8942+0.892 * 1.0196+0.115 * 0.9556
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0673+4.679 * 0.045769-0.327 * 1.0206
=-2.41

* 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 (Jan24) TTM:Last Year (Jan23) TTM:
Total Receivables was $878 Mil.
Revenue was 1069 + 1107 + 1038 + 1046 = $4,260 Mil.
Gross Profit was 635 + 671 + 651 + 635 = $2,592 Mil.
Total Current Assets was $4,415 Mil.
Total Assets was $8,237 Mil.
Property, Plant and Equipment(Net PPE) was $1,014 Mil.
Depreciation, Depletion and Amortization(DDA) was $87 Mil.
Selling, General, & Admin. Expense(SGA) was $1,344 Mil.
Total Current Liabilities was $1,612 Mil.
Long-Term Debt & Capital Lease Obligation was $2,678 Mil.
Net Income was 285 + 242 + 231 + 207 = $965 Mil.
Non Operating Income was -1 + 0 + -1 + -2 = $-4 Mil.
Cash Flow from Operations was 265 + 59 + 38 + 230 = $592 Mil.
Total Receivables was $944 Mil.
Revenue was 1081 + 1094 + 1007 + 996 = $4,178 Mil.
Gross Profit was 624 + 613 + 622 + 626 = $2,485 Mil.
Total Current Assets was $3,843 Mil.
Total Assets was $7,754 Mil.
Property, Plant and Equipment(Net PPE) was $955 Mil.
Depreciation, Depletion and Amortization(DDA) was $78 Mil.
Selling, General, & Admin. Expense(SGA) was $1,235 Mil.
Total Current Liabilities was $1,933 Mil.
Long-Term Debt & Capital Lease Obligation was $2,024 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)
=(878 / 4260) / (944 / 4178)
=0.206103 / 0.225945
=0.9122

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)
=(2485 / 4178) / (2592 / 4260)
=0.594782 / 0.608451
=0.9775

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 - (4415 + 1014) / 8237) / (1 - (3843 + 955) / 7754)
=0.340901 / 0.381223
=0.8942

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
=4260 / 4178
=1.0196

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))
=(78 / (78 + 955)) / (87 / (87 + 1014))
=0.075508 / 0.079019
=0.9556

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)
=(1344 / 4260) / (1235 / 4178)
=0.315493 / 0.295596
=1.0673

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)
=((2678 + 1612) / 8237) / ((2024 + 1933) / 7754)
=0.520821 / 0.510317
=1.0206

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
=(965 - -4 - 592) / 8237
=0.045769

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.

Brown-Forman has a M-score of -2.41 suggests that the company is unlikely to be a manipulator.


Brown-Forman Beneish M-Score Related Terms

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Brown-Forman (Brown-Forman) Business Description

Traded in Other Exchanges
Address
850 Dixie Highway, Louisville, KY, USA, 40210
Brown-Forman is a U.S.-based manufacturer of premium distilled spirits that generates close to 70% of revenues in the whiskey category, under well-known Tennessee whiskey brand Jack Daniel's and bourbon brands Woodford Reserve and Old Forester. It also manufactures and distributes tequila, vodka, rum, gin, and premium wines. The company generates 47% of sales from its home market, while the bulk of international revenues come from Europe, Australia, and Latin America. The Brown family controls over 50% of the economic interests and a 67% voting power of the company.
Executives
De Chabert Ralph E officer: SVP, Chief Diversity Officer 850 DIXIE HIGHWAY, LOUISVILLE KY 40210
Augusta Brown Holland director 850 DIXIE HIGHWAY, LOUISVILLE KY 40210
Kelli Nelson officer: SVP, Chief Accounting Officer 850 DIXIE HIGHWAY, LOUISVILLE KY 40210
Chavanne Patrick Bousquet director 767 FIFTH AVENUE, NEW YORK NY 10153
Matthew E Hamel officer: EVP, Gen Counsel and Secretary 850 DIXIE HIGHWAY, LOUISVILLE KY 40210
Michael Todman director C/O TMA LIMITED, LLC, 500 RENAISSANCE DRIVE, SUITE 103B, ST. JOSEPH MI 49085
Matias Bentel officer: SVP, Chief Brands Officer 850 DIXIE HWY, LOUISVILLE KY 40210
John V. Hayes officer: SVP/President, USA & Canada 850 DIXIE HIGHWAY, LOUISVILLE KY 40210
Tracy L Skeans director 1441 GARDINER LANE, LOUISVILLE KY 40213
Thomas Hinrichs officer: SVP/Pres., Emerging Intl 850 DIXIE HIGHWAY, LOUISVILLE KY 40210
Kirsten M Hawley officer: SVP, Chief HR Officer 850 DIXIE HIGHWAY, LOUISVILLE KY 40210
Kathleen M. Gutmann director 55 GLENLAKE PARKWAY, NE, ATLANTA GA 30328
Alejandro A Alvarez officer: SVP, Chief Production Officer 850 DIXIE HIGHWAY, LOUISVILLE KY 40210
Lawson E Whiting director, officer: President & CEO 850 DIXIE HIGHWAY, LOUISVILLE KY 40228
John D. Cook director 850 DIXIE HIGHWAY, LOUISVILLE KY 40210

Brown-Forman (Brown-Forman) Headlines