Nicholas Financial (Nicholas Financial) Beneish M-Score : -3.82 (As of Apr. 25, 2024)

View and export this data going back to 1997. Start your Free Trial

What is Nicholas Financial Beneish M-Score?

Note: Financial institutions were excluded from the sample in Beneish paper when calculating Beneish M-Score. Thus, the prediction might not fit banks and insurance companies.

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 -3.82 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

NICK' s Beneish M-Score Range Over the Past 10 Years
Min: -4.98 Med: -2.67 Max: 6.17
Current: -3.82

During the past 13 years, the highest Beneish M-Score of Nicholas Financial was 6.17. The lowest was -4.98. And the median was -2.67.

Nicholas Financial 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 Nicholas Financial for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 5.3179

0.528 * 1

0.404 * 0.893

0.892 * 0.0447

0.115 * 0.5279

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 11.5988

4.679 * -0.612775

0.327 * 0

-3.82

* 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 (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was $0.92 Mil.
Revenue was -18.193 + 6.072 + 6.583 + 7.541 = $2.00 Mil.
Gross Profit was -18.193 + 6.072 + 6.583 + 7.541 = $2.00 Mil.
Total Current Assets was $8.73 Mil.
Total Assets was $59.99 Mil.
Property, Plant and Equipment(Net PPE) was $0.17 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.88 Mil.
Selling, General, & Admin. Expense(SGA) was $18.31 Mil.
Total Current Liabilities was $0.00 Mil.
Long-Term Debt & Capital Lease Obligation was $0.00 Mil.
Net Income was -11.661 + -10.485 + 1.556 + -15.797 = $-36.39 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0.00 Mil.
Cash Flow from Operations was -0.418 + 0.284 + 1.169 + -0.661 = $0.37 Mil.

Total Receivables was $3.85 Mil.
Revenue was 10.029 + 12.127 + 10.709 + 11.93 = $44.80 Mil.
Gross Profit was 10.029 + 12.127 + 10.709 + 11.93 = $44.80 Mil.
Total Current Assets was $4.76 Mil.
Total Assets was $145.20 Mil.
Property, Plant and Equipment(Net PPE) was $1.97 Mil.
Depreciation, Depletion and Amortization(DDA) was $1.85 Mil.
Selling, General, & Admin. Expense(SGA) was $35.30 Mil.
Total Current Liabilities was $46.89 Mil.
Long-Term Debt & Capital Lease Obligation was $2.74 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)
	=	(0.915 / 2.003)	/	(3.848 / 44.795)
	=	0.456815	/	0.085902
	=	5.3179

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)
	=	(44.795 / 44.795)	/	(2.003 / 2.003)
	=	1	/	1
	=	1

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 - (8.732 + 0.168) / 59.991)	/	(1 - (4.762 + 1.97) / 145.204)
	=	0.851644	/	0.953638
	=	0.893

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
	=	2.003	/	44.795
	=	0.0447

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))
	=	(1.852 / (1.852 + 1.97))	/	(1.88 / (1.88 + 0.168))
	=	0.484563	/	0.917969
	=	0.5279

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)
	=	(18.31 / 2.003)	/	(35.304 / 44.795)
	=	9.141288	/	0.788124
	=	11.5988

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)
	=	((0 + 0) / 59.991)	/	((2.736 + 46.888) / 145.204)
	=	0	/	0.341754
	=	0

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
	=	(-36.387 - 0	-	0.374)	/	59.991
	=	-0.612775

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.

Nicholas Financial has a M-score of -3.82 suggests that the company is unlikely to be a manipulator.

Nicholas Financial Beneish M-Score Related Terms

Thank you for viewing the detailed overview of Nicholas Financial's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.

Nicholas Financial (Nicholas Financial) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Financial Services » Credit Services » Nicholas Financial Inc (NAS:NICK) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

N/A

Address

2454 McMullen Booth Road, Building C, Suite 501B, Clearwater, FL, USA, 33759

Website

http://www.nicholasfinancial.com

Nicholas Financial Inc is a specialized consumer finance company. It is engaged in acquiring and servicing automobile finance installment contracts for purchases of used and new automobiles and light trucks. It originates direct consumer loans and sells consumer-finance-related products. The majority of its revenue comes from Interest and fee income.

Executives

Magnolia Capital Fund, Lp	10 percent owner	1601 DODGE STREET, SUITE 3300, OMAHA NE 68102
Jeffrey C Royal	director	5420 NICHOLAS STREET, OMAHA NE 68132
Mark R Hutchins	director	2454 MCMULLEN BOOTH RD, BUILDING C, CLEARWATER FL 33759
Michael Rost	officer: interim CEO	2454 MCMULLEN BOOTH RD, BUILDING C, CLEARWATER FL 33759
Irina Nashtatik	officer: CFO	2454 MCMULLEN BOOTH ROAD, BUILDING C, CLEARWATER FL 33759
Douglas W Marohn	officer: Snr. Vice President Branch Ops	2454 MCMULLEN BOOTH RD, BLDG C #501B, CLEARWATER FL 33759
Brendan Joseph Keating	director	8918 SPANISH RIDGE AVENUE, SUITE 100, LAS VEGAS NV 89148
Kelly M Malson	officer: Chief Financial Officer	2454 MCMULLEN BOOTH ROAD, BUILDING C, CLEARWATER FL 33759
Adam K Peterson	director, 10 percent owner	1601 DODGE STREET, SUITE 3300, OMAHA NE 68102
Chad Steinorth	officer: Vice President and Interim CFO	2454 MCMULLEN BOOTH ROAD, BUILDING C, CLEARWATER FL 33759
Jeremy Qinli Zhu	director	1940 LINDA FLORA DRIVE, LOS ANGELES CA 90077
Magnolia Group, Llc	10 percent owner	1601 DODGE STREET, SUITE 3300, OMAHA NE 68102
Robin Hastings	director	2454 MCMULLEN BOOTH RD, BUILDING C, CLEARWATER FL 33759
Todd Pfister	director	2454 MCMULLEN BOOTH ROD, BUILDING C, CLEARWATER FL 33759
Mahan Children Llc	10 percent owner	219 7TH STREET, TIERRA VERDE FL 33715