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CarMax Beneish M-Score

: -0.76 (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.

Warning Sign:

Beneish M-Score -0.76 higher than -1.78, which implies that the company might have manipulated its financial results.

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

NYSE:KMX' s Beneish M-Score Range Over the Past 10 Years
Min: -173.63   Med: -2.23   Max: 4.08
Current: -0.76

-173.63
4.08

During the past 13 years, the highest Beneish M-Score of CarMax was 4.08. The lowest was -173.63. And the median was -2.23.


CarMax Beneish M-Score Historical Data

The historical data trend for CarMax'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.

CarMax Annual Data
Trend Feb12 Feb13 Feb14 Feb15 Feb16 Feb17 Feb18 Feb19 Feb20 Feb21
Beneish M-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.08 -2.38 -2.27 -1.92 -2.19

CarMax Quarterly Data
Nov16 Feb17 May17 Aug17 Nov17 Feb18 May18 Aug18 Nov18 Feb19 May19 Aug19 Nov19 Feb20 May20 Aug20 Nov20 Feb21 May21 Aug21
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 -2.08 -2.28 -2.19 -0.71 -0.76

Competitive Comparison

For the Auto & Truck Dealerships subindustry, CarMax'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.

   

CarMax Beneish M-Score Distribution

For the Vehicles & Parts industry and Consumer Cyclical sector, CarMax's Beneish M-Score distribution charts can be found below:

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



CarMax 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 CarMax 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 * 1.7949+0.528 * 1.1266+0.404 * 0.9963+0.892 * 1.4185+0.115 * 0.969
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8749+4.679 * 0.1119-0.327 * 0.982
=-0.76

* 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 (Aug21) TTM:Last Year (Aug20) TTM:
Accounts Receivable was $517 Mil.
Revenue was 7988.359 + 7697.599 + 5164.257 + 5184.944 = $26,035 Mil.
Gross Profit was 815.484 + 924.509 + 641.369 + 631.43 = $3,013 Mil.
Total Current Assets was $5,371 Mil.
Total Assets was $24,453 Mil.
Property, Plant and Equipment(Net PPE) was $3,683 Mil.
Depreciation, Depletion and Amortization(DDA) was $252 Mil.
Selling, General, & Admin. Expense(SGA) was $2,222 Mil.
Total Current Liabilities was $1,959 Mil.
Long-Term Debt & Capital Lease Obligation was $17,168 Mil.
Net Income was 285.267 + 436.756 + 209.945 + 235.3 = $1,167 Mil.
Non Operating Income was 1.782 + 25.577 + 9.003 + 0.887 = $37 Mil.
Cash Flow from Operations was -1273.438 + -111.883 + -200.626 + -21.39 = $-1,607 Mil.
Accounts Receivable was $203 Mil.
Revenue was 5372.166 + 3228.782 + 4962.49 + 4790.028 = $18,353 Mil.
Gross Profit was 752.143 + 354.183 + 672.857 + 613.647 = $2,393 Mil.
Total Current Assets was $4,328 Mil.
Total Assets was $21,246 Mil.
Property, Plant and Equipment(Net PPE) was $3,489 Mil.
Depreciation, Depletion and Amortization(DDA) was $231 Mil.
Selling, General, & Admin. Expense(SGA) was $1,790 Mil.
Total Current Liabilities was $1,599 Mil.
Long-Term Debt & Capital Lease Obligation was $15,325 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Accounts Receivable 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)
=(517.26 / 26035.159) / (203.155 / 18353.466)
=0.01986775 / 0.01106903
=1.7949

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)
=(2392.83 / 18353.466) / (3012.792 / 26035.159)
=0.13037483 / 0.11572013
=1.1266

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 - (5371.296 + 3682.623) / 24453.322) / (1 - (4327.859 + 3488.931) / 21246.306)
=0.62974687 / 0.6320871
=0.9963

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
=26035.159 / 18353.466
=1.4185

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))
=(231.31 / (231.31 + 3488.931)) / (252.489 / (252.489 + 3682.623))
=0.06217608 / 0.0641631
=0.969

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)
=(2221.655 / 26035.159) / (1790.114 / 18353.466)
=0.08533288 / 0.09753547
=0.8749

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)
=((17168.411 + 1958.96) / 24453.322) / ((15325.082 + 1598.942) / 21246.306)
=0.78219929 / 0.79656313
=0.982

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
=(1167.268 - 37.249 - -1607.337) / 24453.322
=0.1119

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.

CarMax has a M-score of -0.76 signals that the company is likely to be a manipulator.


CarMax Business Description

CarMax logo
Industry
Consumer Cyclical » Vehicles & Parts NAICS : 423110 SIC : 5521
Traded in Other Exchanges
Address
12800 Tuckahoe Creek Parkway, Richmond, VA, USA, 23238
CarMax sells, finances, and services used and new cars through a chain of 220 used retail stores at the end of fiscal 2021 plus one new vehicle store. It was formed in 1993 as a unit of Circuit City and spun off into an independent company in late 2002. Used-vehicle sales account for about 83% of revenue, wholesale about 14%, and the remaining portion is composed of extended service plans and repair. In fiscal 2021, the company retailed and wholesaled 751,862 and 426,268 used vehicles, respectively. CarMax is the largest used vehicle retailer in the U.S., but still estimates that it has only about 3.5% U.S. market share of vehicles 0 to 10 years old but seeks over 5% by the end of calendar 2025. CarMax is based in Richmond, Virginia.
Executives
Oneil Mark F director C/O CARMAX, INC. 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Reedy Thomas W Jr officer: EVP of Finance 12800 TUCKHOE CREEK PARKWAY RICHMOND VA 23238
Margolin Eric M officer: EVP, Gen. Counsel & Secretary C/O ADVANCE AUTO PARTS 5673 AIRPORT RD ROANOKE VA 24012
Lyski James officer: EVP & Chief Marketing Officer ONE NATIONWIDE PLAZA 1-38-06 COLUMBUS OH 43215
Nash William D officer: President & CEO 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Daniels Jon G officer: SVP, CAF 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Folliard Thomas J director 4900 COX RD GELN ALLEN VA 23060
Livesay Jill A officer: VP, Controller & PAO CARMAX, INC. 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Cafritz Diane L officer: SVP & CHRO 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Hill Edwin J officer: EVP & COO 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Blaylock Ronald E director PUBLIC "-//W3C//DTD HTML 4.0 Transitional//EN"> Ownership Information: BLAYLOCK RONALD E a.header:link {color: #3b4fae; font-weight: bold; text-decoration: underline;} a.header:visited {color: #3b4fae; font-weight: bold; text-decoration: underline;} a.header:hover {color: #191970;}
Satriano Pietro director C/O US FOODS HOLDING CORP. 9399 W. HIGGINS RD., STE 100 ROSEMONT IL 60018
Shinder Marcella director 12800 TUCKAHOE CREEK PARKWAY RICHMOND VA 23238
Steenrod Mitchell D director 12800 TUCKAHOE CREEK PKWY RICHMOND VA 23238
Mccreight David W. director C/O URBAN OUTFITTERS, INC. 5000 SOUTH BROAD STREET PHILADELPHIA PA 19112

CarMax Headlines

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