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GuruFocus has detected 3 Warning Signs with Gazprom PJSC $OGZPY.
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Gazprom PJSC (OTCPK:OGZPY)
Beneish M-Score
-2.63 (As of Today)

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.

Gazprom PJSC has a M-score of -2.63 suggests that the company is not a manipulator.

OGZPY' s Beneish M-Score Range Over the Past 10 Years
Min: -3.47   Max: -2.05
Current: -2.63

-3.47
-2.05

During the past 12 years, the highest Beneish M-Score of Gazprom PJSC was -2.05. The lowest was -3.47. And the median was -2.69.


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 Gazprom PJSC 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 * 0.9143+0.528 * 1.2448+0.404 * 1.0208+0.892 * 1.0691+0.115 * 0.9748
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.096+4.679 * -0.0594-0.327 * 0.9239
=-2.63

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Accounts Receivable was USD 9,989 Mil.
Revenue was 21498.067385 + 22695.5361724 + 29713.7677441 + 31932.632119 = USD 105,840 Mil.
Gross Profit was 14614.4518557 + 13567.4704977 + 19402.5654182 + 12739.0285617 = USD 60,324 Mil.
Total Current Assets was USD 52,571 Mil.
Total Assets was USD 285,078 Mil.
Property, Plant and Equipment(Net PPE) was USD 193,450 Mil.
Depreciation, Depletion and Amortization(DDA) was USD 9,557 Mil.
Selling, General & Admin. Expense(SGA) was USD 1,372 Mil.
Total Current Liabilities was USD 30,080 Mil.
Long-Term Debt was USD 41,609 Mil.
Net Income was 1747.23789978 + 4187.63468445 + 6196.49392851 + 1935.21463999 = USD 14,067 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = USD 0 Mil.
Cash Flow from Operations was 4188.18197366 + 4399.94869164 + 11532.8715581 + 10870.4634855 = USD 30,991 Mil.
Accounts Receivable was USD 10,220 Mil.
Revenue was 22109.8854113 + 21638.4299641 + 28189.7212246 + 27061.5529331 = USD 99,000 Mil.
Gross Profit was 16291.6880452 + 14377.11647 + 20812.9126048 + 18754.9341543 = USD 70,237 Mil.
Total Current Assets was USD 62,194 Mil.
Total Assets was USD 280,106 Mil.
Property, Plant and Equipment(Net PPE) was USD 180,319 Mil.
Depreciation, Depletion and Amortization(DDA) was USD 8,673 Mil.
Selling, General & Admin. Expense(SGA) was USD 1,171 Mil.
Total Current Liabilities was USD 34,028 Mil.
Long-Term Debt was USD 42,210 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)
=(9989.46468274 / 105840.003421) / (10219.8392338 / 98999.5895331)
=0.09438269 / 0.10323113
=0.9143

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)
=(70236.6512742 / 98999.5895331) / (60323.5163332 / 105840.003421)
=0.70946407 / 0.56995006
=1.2448

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 - (52570.7884385 + 193449.905935) / 285077.680862) / (1 - (62193.8600992 + 180319.480075) / 280106.464854)
=0.13700472 / 0.13421013
=1.0208

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
=105840.003421 / 98999.5895331
=1.0691

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))
=(8673.01180092 / (8673.01180092 + 180319.480075)) / (9557.19172225 / (9557.19172225 + 193449.905935))
=0.04589077 / 0.04707812
=0.9748

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)
=(1372.15666154 / 105840.003421) / (1171.02787754 / 98999.5895331)
=0.01296444 / 0.01182861
=1.096

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)
=((41609.3381221 + 30079.7502993) / 285077.680862) / ((42209.5604584 + 34028.1682914) / 280106.464854)
=0.25147212 / 0.27217411
=0.9239

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
=(14066.5811527 - 0 - 30991.4657089) / 285077.680862
=-0.0594

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.

Gazprom PJSC has a M-score of -2.63 suggests that the company will not 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 local exchange's currency.

Gazprom PJSC Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.92371.04770.94561.09720.84571.51670.81341.04250.85510.9772
GMI 1.97940.39681111.40610.93411.06191.04431.043
AQI 1.39461.44970.86040.96880.95760.76630.84920.9160.95721.0354
SGI 1.59371.0991.35580.91041.20261.28911.02791.10141.06471.0865
DEPI 0.62521.36821.08011.06981.01711.10120.92640.93080.98831.0129
SGAI 0.72980.06640.82713.46690.95496.97661.12120.82520.22980.8748
LVGI 0.67061.54360.86531.01420.86480.99670.96890.95371.26231.0734
TATA 0.01060.0206-0.0322-0.0076-0.0489-0.0306-0.0208-0.0448-0.1157-0.0729
M-score -1.18-2.36-2.34-2.94-2.63-2.79-2.84-2.52-3.05-2.73

Gazprom PJSC Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 0.95010.85510.98790.91110.97720.91050.9143
GMI 1.10031.0491.02561.09371.23591.27841.2448
AQI 0.90840.95721.00651.12861.03541.01751.0208
SGI 1.05751.06471.06211.05541.08651.08511.0691
DEPI 0.98990.9890.97030.75690.77670.77140.9748
SGAI 0.61980.10310.06090.32243.87285.35091.096
LVGI 1.05931.26231.22351.27191.07341.06880.9239
TATA 0.0106-0.0349-0.0246-0.0683-0.0729-0.0724-0.0594
M-score -2.36-2.64-2.45-2.73-3.17-3.47-2.63
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