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Autonation earnings quality score

How much of the reported profit is backed by cash, and how many markers of managed earnings the filings show

Score57 / 100 · grade C · rank 765 of 1027

Autonation (AN) scores 57 of 100 for earnings quality, grade C: rank 765 of 1027 companies and 112 of 141 in consumer-disc. It loses the most points on accruals of +3.9% of assets, higher than 95% of companies, Montier C-score 3 of 5 checks failed, discretionary accruals of +9.4% of assets (modified Jones), larger than most. It earns full or near-full marks for profit steadier than cash flow (smoothness 0.66), Beneish M-score -2.27: clean (below −2.22), Dechow F-score 0.42 (normal).

What earned and lost points

ComponentWhat the filings showPointsOf
Accrualsaccruals of +3.9% of assets, higher than 95% of companies120
Beneish M-scoreBeneish M-score -2.27: clean (below −2.22)1515
Dechow F-scoreDechow F-score 0.42 (normal)1515
Montier C-scoreMontier C-score 3 of 5 checks failed615
Discretionary accrualsdiscretionary accruals of +9.4% of assets (modified Jones), larger than most110
Piotroski F-scorePiotroski F-score 6 of 9710
Non-GAAP gapadjusted earnings 7% below GAAP810
Earnings smoothnessprofit steadier than cash flow (smoothness 0.66)55
AN: share of the available points, by componentAN: share of the available points, by componentAccruals5%Discretionary accruals13%Beneish M-score100%Dechow F-score100%Montier C-score40%Piotroski F-score67%Non-GAAP gap76%Earnings smoothness92%

How the score is built

Eight published measures, each scored against the whole universe or on its own scale and weighted: accruals 20, discretionary accruals 10, Beneish M 15, Dechow F 15, Montier C 15, Piotroski F 10, the non-GAAP gap 10, smoothness 5. A measure that cannot be computed (Beneish for a bank, say) drops out and the rest is rescaled, so every company is scored on what applies to it.

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Computed from the companies’ own XBRL filings (latest fiscal year) by published formulas; a statistical screen, not an audit or an accusation. A low score means the reported profit shows more of the markers of managed or low-quality earnings than its peers. Not investment advice.