ATA
ConsumerValuation Breakdown
A classic Discounted Cash Flow model built on Free Cash Flow (FCF), the actual cash a business generates after all operating expenses and capital expenditures. Future FCF is projected for 10 years with gradually decaying growth, then discounted back to today's value using WACC. This is the gold standard of intrinsic valuation: it values the company based on what it can actually deliver to shareholders, independent of market sentiment.
Earnings Quality
Fiscal year 2024
Financial Forensics
Beneish M-Score · 2016
ATA's Beneish M-Score of -2.9653 indicates a low likelihood of earnings manipulation, but its earnings quality score of 23.6/100 raises concerns about the sustainability of earnings. The high DSRI of 1.5431 suggests potential issues with inventory management, which could impact future cash flows.
- Earnings Quality Score of 23.6/100 indicates poor earnings quality, particularly concerning cash conversion and revenue recognition.
- DSRI of 1.5431 suggests that inventory growth is outpacing revenue growth, which may signal overproduction or declining demand.
- Beneish M-Score of -2.9653 is below the manipulation threshold of -1.78, indicating a lower likelihood of earnings manipulation.
- Strong accrual score of 94.2/100 suggests that reported earnings are primarily from actual cash flows, despite overall low earnings quality.
The ownership structure is relatively fragmented, with the largest institutional shareholder holding only 14.5%. This may lead to governance challenges and potential conflicts of interest among individual shareholders.
Investors should closely monitor ATA's inventory management and earnings quality metrics. It may be prudent to adopt a cautious approach until there are clear improvements in cash conversion and revenue recognition.
Generated by AI based on quantitative data. Not financial advice.
Quantitative Scores
Key Ratios
Company Overview
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