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LOW (Lowe's) Beneish M-Score : -2.82 (As of Oct. 31, 2024)


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What is Lowe's 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 -2.82 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

LOW' s Beneish M-Score Range Over the Past 10 Years
Min: -3.15   Med: -2.72   Max: -2.21
Current: -2.82

During the past 13 years, the highest Beneish M-Score of Lowe's was -2.21. The lowest was -3.15. And the median was -2.72.


Lowe's Beneish M-Score Historical Data

The historical data trend for Lowe's'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.

Lowe's Beneish M-Score Chart

Lowe's Annual Data
Trend Jan15 Jan16 Jan17 Jan18 Jan19 Jan20 Jan21 Jan22 Jan23 Jan24
Beneish M-Score
Get a 7-Day Free Trial Premium Member Only Premium Member Only -2.55 -2.79 -2.63 -2.86 -2.53

Lowe's Quarterly Data
Oct19 Jan20 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22 Jan23 Apr23 Jul23 Oct23 Jan24 Apr24 Jul24
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 -2.78 -2.40 -2.53 -2.81 -2.82

Competitive Comparison of Lowe's's Beneish M-Score

For the Home Improvement Retail subindustry, Lowe's'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.


Lowe's's Beneish M-Score Distribution in the Retail - Cyclical Industry

For the Retail - Cyclical industry and Consumer Cyclical sector, Lowe's's Beneish M-Score distribution charts can be found below:

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



Lowe's 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 Lowe's 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+0.528 * 1.0013+0.404 * 0.9916+0.892 * 0.9013+0.115 * 0.9973
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8936+4.679 * -0.059109-0.327 * 0.9835
=-2.82

* 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 (Jul24) TTM:Last Year (Jul23) TTM:
Total Receivables was $0 Mil.
Revenue was 23586 + 21364 + 18602 + 20471 = $84,023 Mil.
Gross Profit was 7895 + 7090 + 6027 + 6891 = $27,903 Mil.
Total Current Assets was $22,337 Mil.
Total Assets was $44,934 Mil.
Property, Plant and Equipment(Net PPE) was $21,334 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,949 Mil.
Selling, General, & Admin. Expense(SGA) was $15,692 Mil.
Total Current Liabilities was $18,246 Mil.
Long-Term Debt & Capital Lease Obligation was $38,397 Mil.
Net Income was 2383 + 1755 + 1020 + 1773 = $6,931 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 3153 + 4262 + 1108 + 1064 = $9,587 Mil.
Total Receivables was $0 Mil.
Revenue was 24956 + 22347 + 22445 + 23479 = $93,227 Mil.
Gross Profit was 8399 + 7527 + 7257 + 7818 = $31,001 Mil.
Total Current Assets was $22,236 Mil.
Total Assets was $44,521 Mil.
Property, Plant and Equipment(Net PPE) was $21,023 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,915 Mil.
Selling, General, & Admin. Expense(SGA) was $19,485 Mil.
Total Current Liabilities was $17,612 Mil.
Long-Term Debt & Capital Lease Obligation was $39,450 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)
=(0 / 84023) / (0 / 93227)
=0 / 0
=1

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)
=(31001 / 93227) / (27903 / 84023)
=0.332532 / 0.332088
=1.0013

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 - (22337 + 21334) / 44934) / (1 - (22236 + 21023) / 44521)
=0.028108 / 0.028346
=0.9916

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
=84023 / 93227
=0.9013

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))
=(1915 / (1915 + 21023)) / (1949 / (1949 + 21334))
=0.083486 / 0.083709
=0.9973

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)
=(15692 / 84023) / (19485 / 93227)
=0.186758 / 0.209006
=0.8936

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)
=((38397 + 18246) / 44934) / ((39450 + 17612) / 44521)
=1.260582 / 1.281687
=0.9835

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
=(6931 - 0 - 9587) / 44934
=-0.059109

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.

Lowe's has a M-score of -2.82 suggests that the company is unlikely to be a manipulator.


Lowe's Business Description

Address
1000 Lowes Boulevard, Mooresville, NC, USA, 28117
Lowe's is the second-largest home improvement retailer in the world, operating more than 1,700 stores in the United States, after the 2023 divestiture of its Canadian locations (RONA, Lowe's Canada, Réno-Dépôt, and Dick's Lumber). The firm's stores offer products and services for home decorating, maintenance, repair, and remodeling, with maintenance and repair accounting for two thirds of products sold. Lowe's targets retail do-it-yourself (around 75% of sales) and do-it-for-me customers as well as commercial and professional business clients (around 25% of sales). We estimate Lowe's captures a high-single-digit share of the domestic home improvement market, based on US Census data and management's market size estimates.
Executives
Griggs Dan Clayton Jr officer: Vice President, CAO 1000 LOWES BOULEVARD, MOORESVILLE NC 28117
Brandon J Sink officer: EVP, Chief Financial Officer 1000 LOWE'S BOULEVARD, MOORESVILLE NC 28117
Seemantini Godbole officer: EVP, Chief Information Officer 1000 LOWE'S BOULEVARD, MOORESVILLE NC 28117
Janice Dupre Little officer: EVP Human Resources 1000 LOWES BOULEVARD, MOORESVILLE NC 28117
Joseph Michael Mcfarland officer: EVP, Stores 1000 LOWE'S BOULEVARD, MOORESVILLE NC 28117
Quonta D Vance officer: EVP, Pro & Home Services 1000 LOWE'S BOULEVARD, MOORESVILLE NC 28117
Donald Frieson officer: EVP, Supply Chain 1000 LOWE'S BOULEVARD, MOORESVILLE NC 28117
William P Boltz officer: EVP, Merchandising 1000 LOWE'S BOULEVARD, MOORESVILLE NC 28117
Juliette Williams Pryor officer: EVP, CLO & Corp. Sec. 1000 LOWE'S BOULEVARD, MOORESVILLE NC 28117
Ross W Mccanless officer: SR VP Gen Counsel & Secretary
Scott H Baxter director 400 NORTH ELM STREET, GREENSBORO NC 27401
Taylor Colleen director C/O BILL.COM HOLDINGS, INC., 1800 EMBARCADERO ROAD, PALO ALTO CA 94303
Stone West Mary E director C/O HASBRO, INC., 1011 NEWPORT AVENUE, PAWTUCKET RI 02861
Daniel J Heinrich director CLOROX CO, 1221 BROADWAY, OAKLAND CA 94612
David H Batchelder director 1000 LOWE'S BOULEVARD, MOORESVILLE NC 28117