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Occidental Petroleum Corp (NYSE:OXY)
Beneish M-Score
-2.86 (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.

Occidental Petroleum Corp has a M-score of -2.86 suggests that the company is not a manipulator.

OXY' s 10-Year Beneish M-Score Range
Min: -3.41   Max: -0.96
Current: -2.86

-3.41
-0.96

During the past 13 years, the highest Beneish M-Score of Occidental Petroleum Corp was -0.96. The lowest was -3.41. And the median was -2.73.


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 Occidental Petroleum 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 * 1.0127+0.528 * 0.9344+0.404 * 0.8707+0.892 * 1.1019+0.115 * 0.9697
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9487+4.679 * -0.0868-0.327 * 0.9871
=-2.86

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

This Year (Jun14) TTM:Last Year (Jun13) TTM:
Accounts Receivable was $5,826 Mil.
Revenue was 6846 + 6118 + 7233 + 6475 = $26,672 Mil.
Gross Profit was 3549 + 2920 + 9202 + 3261 = $18,932 Mil.
Total Current Assets was $10,786 Mil.
Total Assets was $70,293 Mil.
Property, Plant and Equipment(Net PPE) was $57,134 Mil.
Depreciation, Depletion and Amortization(DDA) was $5,368 Mil.
Selling, General & Admin. Expense(SGA) was $1,799 Mil.
Total Current Liabilities was $8,869 Mil.
Long-Term Debt was $6,835 Mil.
Net Income was 1431 + 1390 + 1643 + 1583 = $6,047 Mil.
Non Operating Income was -46 + -30 + -17 + -26 = $-119 Mil.
Cash Flow from Operations was 2867 + 2697 + 3141 + 3561 = $12,266 Mil.
Accounts Receivable was $5,221 Mil.
Revenue was 6121 + 5907 + 6187 + 5991 = $24,206 Mil.
Gross Profit was 2941 + 2770 + 7529 + 2815 = $16,055 Mil.
Total Current Assets was $10,859 Mil.
Total Assets was $67,422 Mil.
Property, Plant and Equipment(Net PPE) was $53,949 Mil.
Depreciation, Depletion and Amortization(DDA) was $4,901 Mil.
Selling, General & Admin. Expense(SGA) was $1,721 Mil.
Total Current Liabilities was $8,234 Mil.
Long-Term Debt was $7,026 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)
=(5826 / 26672) / (5221 / 24206)
=0.21843131 / 0.21569032
=1.0127

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)
=(2920 / 24206) / (3549 / 26672)
=0.66326531 / 0.70980804
=0.9344

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 - (10786 + 57134) / 70293) / (1 - (10859 + 53949) / 67422)
=0.0337587 / 0.03877073
=0.8707

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
=26672 / 24206
=1.1019

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))
=(4901 / (4901 + 53949)) / (5368 / (5368 + 57134))
=0.08327952 / 0.08588525
=0.9697

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)
=(1799 / 26672) / (1721 / 24206)
=0.06744901 / 0.07109807
=0.9487

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)
=((6835 + 8869) / 70293) / ((7026 + 8234) / 67422)
=0.22340774 / 0.22633562
=0.9871

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
=(6047 - -119 - 12266) / 70293
=-0.0868

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.

Occidental Petroleum Corp has a M-score of -2.86 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 own currency.

Occidental Petroleum Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 1.64461.00540.92271.32120.51242.15080.95910.85160.90621.0877
GMI 0.98110.92230.99330.95990.94631.05840.98660.97681.00970.9581
AQI 1.17020.70420.85490.68821.12121.11180.9630.86740.88070.801
SGI 1.17771.37921.16251.13231.22320.61041.28211.2591.00561.0611
DEPI 0.98281.06440.96340.92511.07140.975311.09010.9140.9121
SGAI 0.92340.99980.87970.89820.73621.65750.83760.86651.04611.0594
LVGI 0.88180.8650.82410.97220.89851.03841.2060.93280.96860.9931
TATA -0.0722-0.0439-0.0759-0.0383-0.0914-0.0654-0.0939-0.0888-0.1033-0.0996
M-score -1.96-2.45-2.75-2.37-3.05-2.13-2.77-2.81-3.10-2.93

Occidental Petroleum Corp Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.78360.80841.0640.90620.90181.05291.03161.08770.96411.0127
GMI 1.00171.03781.05011.00971.01320.98410.95640.95810.93970.9344
AQI 0.83340.81840.84470.88070.92140.90530.84860.8010.8240.8707
SGI 1.21311.10691.0421.00560.969711.02351.06111.08671.1019
DEPI 1.00080.9750.96350.9140.91930.90660.91120.91210.93170.9697
SGAI 0.83990.82920.99411.04611.06191.17641.08041.05941.05880.9487
LVGI 0.93291.11211.04720.96860.99240.93830.96630.99310.96670.9871
TATA -0.0954-0.0969-0.0935-0.1033-0.1028-0.1051-0.1137-0.0996-0.0992-0.0868
M-score -2.95-3.08-2.88-3.10-3.12-2.99-3.06-2.93-3.01-2.86
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