AAR Beneish M-Score Historical Data
The historical data trend for AAR'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.
AAR Beneish M-Score Chart
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AAR Annual Data
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Trend |
May15 |
May16 |
May17 |
May18 |
May19 |
May20 |
May21 |
May22 |
May23 |
May24 |
| Beneish M-Score |
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-2.62 |
-2.38 |
-2.31 |
-2.15 |
-2.28 |
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AAR Quarterly Data
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May20 |
Aug20 |
Nov20 |
Feb21 |
May21 |
Aug21 |
Nov21 |
Feb22 |
May22 |
Aug22 |
Nov22 |
Feb23 |
May23 |
Aug23 |
Nov23 |
Feb24 |
May24 |
Aug24 |
Nov24 |
Feb25 |
| Beneish M-Score |
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-2.41 |
-2.28 |
-2.27 |
-2.33 |
-2.16 |
Competitive Comparison of AAR's Beneish M-Score
For the Aerospace & Defense subindustry, AAR'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.
AAR's Beneish M-Score Distribution in the Aerospace & Defense Industry
For the Aerospace & Defense industry and Industrials sector, AAR's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where AAR's Beneish M-Score falls into.
AAR 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 AAR 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 * 1.1197 | + | 0.528 * 1.0147 | + | 0.404 * 1.385 | + | 0.892 * 1.2107 | + | 0.115 * 0.6546 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 1.0464 | + | 4.679 * 0.01413 | - | 0.327 * 1.4902 |
| = | -2.16 |
* 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 (Feb25) TTM: | Last Year (Feb24) TTM: |
Total Receivables was $466 Mil.
Revenue was 678.2 + 686.1 + 661.7 + 656.5 = $2,683 Mil.
Gross Profit was 131.7 + 128.6 + 117.2 + 127.3 = $505 Mil.
Total Current Assets was $1,535 Mil.
Total Assets was $2,859 Mil.
Property, Plant and Equipment(Net PPE) was $232 Mil.
Depreciation, Depletion and Amortization(DDA) was $57 Mil.
Selling, General, & Admin. Expense(SGA) was $365 Mil.
Total Current Liabilities was $545 Mil.
Long-Term Debt & Capital Lease Obligation was $1,090 Mil.
Net Income was -8.9 + -30.6 + 18 + 9.1 = $-12 Mil.
Non Operating Income was -63.6 + 0.5 + 2.1 + -1 = $-62 Mil.
Cash Flow from Operations was -18.7 + 22 + -18.6 + 24.5 = $9 Mil.
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Total Receivables was $344 Mil.
Revenue was 567.3 + 545.4 + 549.7 + 553.3 = $2,216 Mil.
Gross Profit was 110.3 + 103.4 + 101.3 + 108.1 = $423 Mil.
Total Current Assets was $1,241 Mil.
Total Assets was $2,022 Mil.
Property, Plant and Equipment(Net PPE) was $224 Mil.
Depreciation, Depletion and Amortization(DDA) was $33 Mil.
Selling, General, & Admin. Expense(SGA) was $288 Mil.
Total Current Liabilities was $428 Mil.
Long-Term Debt & Capital Lease Obligation was $348 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) |
| = | (465.8 / 2682.5) | / | (343.6 / 2215.7) |
| = | 0.173644 | / | 0.155075 |
| | = | 1.1197 |
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) |
| = | (423.1 / 2215.7) | / | (504.8 / 2682.5) |
| = | 0.190955 | / | 0.188183 |
| | = | 1.0147 |
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 - (1534.8 + 232.4) / 2859.1) | / | (1 - (1240.7 + 223.6) / 2021.8) |
| = | 0.381903 | / | 0.275744 |
| | = | 1.385 |
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 |
| = | 2682.5 | / | 2215.7 |
| | = | 1.2107 |
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)) |
| = | (33.2 / (33.2 + 223.6)) | / | (57.2 / (57.2 + 232.4)) |
| = | 0.129283 | / | 0.197514 |
| | = | 0.6546 |
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) |
| = | (365.1 / 2682.5) | / | (288.2 / 2215.7) |
| = | 0.136104 | / | 0.130072 |
| | = | 1.0464 |
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) |
| = | ((1089.9 + 545.2) / 2859.1) | / | ((347.7 + 428.2) / 2021.8) |
| = | 0.571893 | / | 0.383767 |
| | = | 1.4902 |
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 |
| = | (-12.4 - -62 | - | 9.2) | / | 2859.1 |
| | = | 0.01413 |
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.
AAR has a M-score of -2.16 suggests that the company is unlikely to be a manipulator.
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