Paychex Beneish M-Score Historical Data
The historical data trend for Paychex'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.
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Paychex Annual Data
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Trend |
May13 |
May14 |
May15 |
May16 |
May17 |
May18 |
May19 |
May20 |
May21 |
May22 |
| Beneish M-Score |
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-2.59 |
-1.91 |
-2.70 |
-2.30 |
-2.35 |
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Paychex Quarterly Data
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May18 |
Aug18 |
Nov18 |
Feb19 |
May19 |
Aug19 |
Nov19 |
Feb20 |
May20 |
Aug20 |
Nov20 |
Feb21 |
May21 |
Aug21 |
Nov21 |
Feb22 |
May22 |
Aug22 |
Nov22 |
Feb23 |
| Beneish M-Score |
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-2.52 |
-2.35 |
-2.27 |
-2.52 |
-2.40 |
Competitive Comparison
For the Staffing & Employment Services subindustry, Paychex'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.
Paychex Beneish M-Score Distribution
For the Business Services industry and Industrials sector, Paychex's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where Paychex's Beneish M-Score falls in comparison to its industry or sector. The grey bar indicates the Beneish M-Score's extreme value range as defined by GuruFocus.
Paychex 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 Paychex 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 * 1.0731 | + | 0.528 * 1.002 | + | 0.404 * 0.9671 | + | 0.892 * 1.0946 | + | 0.115 * 0.9856 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 0.9928 | + | 4.679 * -0.012062 | - | 0.327 * 1.0074 |
| = | -2.40 |
* 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 (Feb23) TTM: | Last Year (Feb22) TTM: |
Total Receivables was $1,415 Mil.
Revenue was 1381 + 1190.3 + 1206.2 + 1144.3 = $4,922 Mil.
Gross Profit was 1008.1 + 831 + 855.2 + 784.3 = $3,479 Mil.
Total Current Assets was $7,595 Mil.
Total Assets was $10,604 Mil.
Property, Plant and Equipment(Net PPE) was $453 Mil.
Depreciation, Depletion and Amortization(DDA) was $182 Mil.
Selling, General, & Admin. Expense(SGA) was $1,505 Mil.
Total Current Liabilities was $5,958 Mil.
Long-Term Debt & Capital Lease Obligation was $861 Mil.
Net Income was 467.4 + 360.3 + 379.2 + 296.4 = $1,503 Mil.
Non Operating Income was -0.3 + 2 + 0.1 + 2.1 = $4 Mil.
Cash Flow from Operations was 604.2 + 321.6 + 364.3 + 337.2 = $1,627 Mil.
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Total Receivables was $1,205 Mil.
Revenue was 1276 + 1108.5 + 1082.9 + 1029.2 = $4,497 Mil.
Gross Profit was 923.8 + 776.9 + 770.4 + 713.4 = $3,185 Mil.
Total Current Assets was $7,237 Mil.
Total Assets was $10,284 Mil.
Property, Plant and Equipment(Net PPE) was $484 Mil.
Depreciation, Depletion and Amortization(DDA) was $190 Mil.
Selling, General, & Admin. Expense(SGA) was $1,385 Mil.
Total Current Liabilities was $5,688 Mil.
Long-Term Debt & Capital Lease Obligation was $877 Mil.
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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) |
| = | (1415 / 4921.8) | / | (1204.7 / 4496.6) |
| = | 0.287496 | / | 0.267914 |
| | = | 1.0731 |
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) |
| = | (3184.5 / 4496.6) | / | (3478.6 / 4921.8) |
| = | 0.708202 | / | 0.706774 |
| | = | 1.002 |
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 - (7595.2 + 452.6) / 10603.6) | / | (1 - (7237.3 + 483.5) / 10283.7) |
| = | 0.241031 | / | 0.24922 |
| | = | 0.9671 |
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 |
| = | 4921.8 | / | 4496.6 |
| | = | 1.0946 |
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)) |
| = | (190.1 / (190.1 + 483.5)) | / | (181.6 / (181.6 + 452.6)) |
| = | 0.282215 | / | 0.286345 |
| | = | 0.9856 |
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) |
| = | (1504.8 / 4921.8) | / | (1384.7 / 4496.6) |
| = | 0.305742 | / | 0.307944 |
| | = | 0.9928 |
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) |
| = | ((861 + 5958.1) / 10603.6) | / | ((876.9 + 5687.9) / 10283.7) |
| = | 0.643093 | / | 0.638369 |
| | = | 1.0074 |
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 |
| = | (1503.3 - 3.9 | - | 1627.3) | / | 10603.6 |
| | = | -0.012062 |
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.
Paychex has a M-score of -2.40 suggests that the company is unlikely to be a manipulator.
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