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Murphy Oil Corp (NYSE:MUR)
Beneish M-Score
62.07 (As of Today)

Warning Sign:

Beneish M-Score 62.07 higher than -2.22, which implies that it might have manipulated its financial results.

The zones of discrimination for M-Score is as such:

An M-Score of less than -2.22 suggests that the company is not an accounting manipulator.
An M-Score of greater than -2.22 signals that the company is likely an accounting manipulator.

Murphy Oil Corp has a M-score of 62.07 signals that the company is a manipulator.

MUR' s 10-Year Beneish M-Score Range
Min: -3.99   Max: -2.07
Current: 62.07

-3.99
-2.07

During the past 13 years, the highest Beneish M-Score of Murphy Oil Corp was -2.07. The lowest was -3.99. And the median was -2.65.


Definition

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Z-Score) or business trend (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 Murphy Oil Corp 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 * 0+0.528 * 0.8982+0.404 * 27.1263+0.892 * 266.6153+0.115 * 0.1033
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.8234+4.679 * -38.8773-0.327 * 0.9551
=62.07

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $0 Mil.
Revenue was 1407.626 + 1433037 + 1349.021 + 1286.4 = $1,437,080 Mil.
Gross Profit was 1131.376 + 1050086 + 928.344 + 885.679 = $1,053,031 Mil.
Total Current Assets was $3,256 Mil.
Total Assets was $16,721 Mil.
Property, Plant and Equipment(Net PPE) was $0 Mil.
Depreciation, Depletion and Amortization(DDA) was $500,558 Mil.
Selling, General & Admin. Expense(SGA) was $83,241 Mil.
Total Current Liabilities was $3,083 Mil.
Long-Term Debt was $2,536 Mil.
Net Income was 375.238 + 245708 + 129.412 + 155.253 = $246,368 Mil.
Non Operating Income was -65.1 + 0 + 0 + 0 = $-65 Mil.
Cash Flow from Operations was 714.596 + 894334 + 723.804 + 735.879 = $896,508 Mil.
Accounts Receivable was $1,000 Mil.
Revenue was 1347.669 + 1419.496 + 1331.986 + 1290.938 = $5,390 Mil.
Gross Profit was 697.943 + 1013.127 + 991.439 + 845.222 = $3,548 Mil.
Total Current Assets was $3,509 Mil.
Total Assets was $17,509 Mil.
Property, Plant and Equipment(Net PPE) was $13,481 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,553 Mil.
Selling, General & Admin. Expense(SGA) was $379 Mil.
Total Current Liabilities was $3,224 Mil.
Long-Term Debt was $2,937 Mil.



1. DSRI = Days Sales in Receivables Index

Measured as the ratio of days’ sales in 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 / 1437080.047) / (999.872 / 5390.089)
=0 / 0.18550195
=0

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)
=(1050086 / 5390.089) / (1131.376 / 1437080.047)
=0.65819525 / 0.73275765
=0.8982

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 plant, property and equipment to total assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (3256.1 + 0) / 16721.2) / (1 - (3508.643 + 13481.055) / 17509.484)
=0.80527115 / 0.02968597
=27.1263

4. SGI = Sales Growth Index

Ratio of sales 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
=1437080.047 / 5390.089
=266.6153

5. DEPI = Depreciation Index

Measured as the ratio of the rate of depreciation 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))
=(1553.394 / (1553.394 + 13481.055)) / (500558.096 / (500558.096 + 0))
=0.10332231 / 1
=0.1033

6. SGAI = Sales, General and Administrative expenses Index

The ratio of SGA expenses 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)
=(83241.044 / 1437080.047) / (379.167 / 5390.089)
=0.05792374 / 0.07034522
=0.8234

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$sgai= in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((2536.2 + 3082.9) / 16721.2) / ((2936.563 + 3224.031) / 17509.484)
=0.33604646 / 0.35184326
=0.9551

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
=(246367.903 - -65.1 - 896508.279) / 16721.2
=-38.8773

An M-Score of less than -2.22 suggests that the company will not be a manipulator. An M-Score of greater than -2.22 signals that the company is likely to be a manipulator.

Murphy Oil Corp has a M-score of 62.07 signals that the company is likely to be a manipulator.


Related Terms

Altman Z-Score, Piotroski F-Score, Accounts Receivable, Revenue, Gross Profit, Total Current Assets, Total Assets, Property, Plant and Equipment, Depreciation, Depletion and Amortization, Selling, General & Admin. Expense, Total Current Liabilities, Long-Term Debt, Net Income, Non Operating Income, Cash Flow from Operations


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Murphy Oil Corp Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.87450.9391.10770.48922.04190.94520.7737.13450.46240
GMI 0.96521.24921.12420.52521.40971.05911.02740.20321.02740.8217
AQI 0.92911.47811.41961.00660.48020.89380.68881.50811.292527.1263
SGI 1.40741.22491.28881.48770.69311.06091.37030.16711.16681.016
DEPI 0.95921.14131.07710.75350.92771.04971.03871.06370.85020.1033
SGAI 0.85321.17420.77850.66982.05710.75010.83765.01781.30230.9449
LVGI 0.89390.96541.19690.75971.06010.98130.79971.48391.09040.9551
TATA -0.075-0.0294-0.0867-0.1166-0.0805-0.1677-0.0619-0.1184-0.1392-0.1221
M-score -2.57-2.15-2.31-3.20-2.38-3.22-2.660.81-3.446.42

Murphy Oil Corp Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
DSRI 1.03452.4664.14524.385529.45581.34080.86240.17820.00030
GMI 0.81290.56110.32560.0770.02870.3760.63292.69927.26130.8982
AQI 0.50751.50810.93120.66610.44591.29252.28073.24621.030827.1263
SGI 0.88980.48360.27230.06770.02870.40240.69672.83712122.5196266.6153
DEPI 1.02941.06371.091.10150.92680.85020.83860.82860.10110.1033
SGAI 1.2452.03483.325912.933934.69693.20041.94390.48850.12250.8234
LVGI 0.92761.48391.39121.62081.24061.09041.13271.02821.12270.9551
TATA -0.0765-0.1184-0.1096-0.1181-0.1349-0.1392-0.1396-0.1519-36.4607-38.8773
M-score -3.22-2.50-1.6514.7815.58-3.99-3.43-0.441,721.7262.07
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