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LAD (Lithia Motors) Beneish M-Score : -2.15 (As of Oct. 31, 2024)


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What is Lithia Motors 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 -2.15 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

LAD' s Beneish M-Score Range Over the Past 10 Years
Min: -3.18   Med: -2.07   Max: -1.29
Current: -2.15

During the past 13 years, the highest Beneish M-Score of Lithia Motors was -1.29. The lowest was -3.18. And the median was -2.07.


Lithia Motors Beneish M-Score Historical Data

The historical data trend for Lithia Motors'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.

Lithia Motors Beneish M-Score Chart

Lithia Motors Annual Data
Trend Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20 Dec21 Dec22 Dec23
Beneish M-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only -2.72 -2.19 -2.25 -1.75 -1.80

Lithia Motors Quarterly Data
Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22 Sep22 Dec22 Mar23 Jun23 Sep23 Dec23 Mar24 Jun24 Sep24
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 -2.08 -1.80 -1.85 -1.99 -2.15

Competitive Comparison of Lithia Motors's Beneish M-Score

For the Auto & Truck Dealerships subindustry, Lithia Motors'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.


Lithia Motors's Beneish M-Score Distribution in the Vehicles & Parts Industry

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

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



Lithia Motors 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 Lithia Motors 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 * 1.0574+0.528 * 1.0871+0.404 * 0.9761+0.892 * 1.1445+0.115 * 0.9491
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9895+4.679 * 0.028481-0.327 * 1.0671
=-2.15

* 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 (Sep24) TTM:Last Year (Sep23) TTM:
Total Receivables was $1,209 Mil.
Revenue was 9221 + 9231.8 + 8561.8 + 7674.3 = $34,689 Mil.
Gross Profit was 1430.4 + 1423.9 + 1335.2 + 1260.7 = $5,450 Mil.
Total Current Assets was $7,893 Mil.
Total Assets was $23,262 Mil.
Property, Plant and Equipment(Net PPE) was $5,387 Mil.
Depreciation, Depletion and Amortization(DDA) was $351 Mil.
Selling, General, & Admin. Expense(SGA) was $3,684 Mil.
Total Current Liabilities was $6,664 Mil.
Long-Term Debt & Capital Lease Obligation was $8,809 Mil.
Net Income was 209.1 + 214.2 + 162.6 + 213.5 = $799 Mil.
Non Operating Income was 7.1 + 24.5 + 26.9 + 10.3 = $69 Mil.
Cash Flow from Operations was 219.3 + -148.4 + 292.4 + -295.2 = $68 Mil.
Total Receivables was $999 Mil.
Revenue was 8277 + 8111.5 + 6973.8 + 6946.5 = $30,309 Mil.
Gross Profit was 1371.3 + 1385.1 + 1211.5 + 1209.1 = $5,177 Mil.
Total Current Assets was $5,818 Mil.
Total Assets was $18,270 Mil.
Property, Plant and Equipment(Net PPE) was $4,420 Mil.
Depreciation, Depletion and Amortization(DDA) was $272 Mil.
Selling, General, & Admin. Expense(SGA) was $3,253 Mil.
Total Current Liabilities was $4,375 Mil.
Long-Term Debt & Capital Lease Obligation was $7,013 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)
=(1209.4 / 34688.9) / (999.3 / 30308.8)
=0.034864 / 0.032971
=1.0574

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)
=(5177 / 30308.8) / (5450.2 / 34688.9)
=0.170808 / 0.157117
=1.0871

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 - (7893.1 + 5386.5) / 23261.5) / (1 - (5818.2 + 4420.1) / 18269.8)
=0.429117 / 0.439605
=0.9761

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
=34688.9 / 30308.8
=1.1445

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))
=(272.4 / (272.4 + 4420.1)) / (350.9 / (350.9 + 5386.5))
=0.05805 / 0.06116
=0.9491

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)
=(3683.7 / 34688.9) / (3252.7 / 30308.8)
=0.106192 / 0.107319
=0.9895

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)
=((8808.6 + 6664.1) / 23261.5) / ((7012.7 + 4375.3) / 18269.8)
=0.665163 / 0.623324
=1.0671

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
=(799.4 - 68.8 - 68.1) / 23261.5
=0.028481

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.

Lithia Motors has a M-score of -2.15 suggests that the company is unlikely to be a manipulator.


Lithia Motors Beneish M-Score Related Terms

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Lithia Motors Business Description

Traded in Other Exchanges
Address
150 N. Bartlett Street, Medford, OR, USA, 97501
Lithia Motors is a retailer of new and used vehicles and related services. The company offers over 50 brands of vehicles at nearly 500 stores globally across the US, Canada, and UK. The company has expanded largely through the acquisition of dealerships in smaller regional markets but now seeks to grow in any part of the US and we expect more deals over time in the US and, at times, abroad. Annual revenue in 2023 was $31 billion and we see over $50 billion possible in a few years. The US was 90% of 2023 revenue and the UK second at 6%, the latter should rise to around 20% with the 2024 Pendragon acquisition. In 2023, new-car sales were about 49% of total revenue. Lithia was founded in 1946, went public in 1996, and is the largest US auto dealer. It is based in Medford, Oregon.
Executives
Sidney B Deboer director, officer: Executive Chairman 234 VISTA ST., ASHLAND OR 97520
Louis Miramontes director 150 N. BARTLETT ST., MEDFORD OR 97501
Shauna Mcintyre director 150 N. BARTLETT STREET, MEDFORD OR 97501
Bryan B Deboer director, officer: Chief Executive officer 150 N. BARTLETT STREET, MEDFORD OR 97501
Tina Miller officer: VP, CAO & Principal Fin. Off. 150 N. BARTLETT ST., MEDFORD OR 97501
Chris Holzshu officer: Sr. Vice President & CFO 150 N. BARTLETT STREET, MEDFORD OR 97501
David Stork officer: Senior Vice President 150 N. BARTLETT STREET, MEDFORD OR 97501
George N Hines officer: SVP, Chief Tech. & Innov. Off. 150 N. BARTLETT ST., MEDFORD OR 97501
Loretz Congdon Stacy director C/O CORE-MARK HOLDING CO. INC., 395 OYSTER POINT BLVD., SUITE 415, SOUTH SAN FRANCISCO CA 94080
Gary M Glandon officer: Chief People Officer C/O LITHIA MOTORS, INC., 150 NORTH BARTLETT STREET, MEDFORD OR 97501
James E. Lentz director C/O LITHIA MOTORS INC., 150 NORTH BARTLETT STREET, MEDFORD OR 97501
Scott Hillier officer: Sr. VP of Operations 150 N. BARTLETT STREET, MEDFORD OR 97501
Kenneth E Roberts director 150 N. BARTLETT ST., MEDFORD OR 97501
Marguerite Celeste officer: Senior Vice President 150 N BARTLETT STREET, MEDFORD OR 97501
Susan O Cain director 150 NORTH BARTLETT STREET, MEDFORD OR 97501