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PDL BioPharma Inc (NAS:PDLI)
Beneish M-Score
-3.08 (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.

PDL BioPharma Inc has a M-score of -3.08 suggests that the company is not a manipulator.

PDLI' s Beneish M-Score Range Over the Past 10 Years
Min: -5.18   Max: 174.26
Current: -3.08

-5.18
174.26

During the past 13 years, the highest Beneish M-Score of PDL BioPharma Inc was 174.26. The lowest was -5.18. And the median was -2.48.


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 PDL BioPharma Inc 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 * 0.571+0.528 * 1+0.404 * 1.0122+0.892 * 0.6721+0.115 * 0.3123
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.4329+4.679 * 0.0365-0.327 * 0.7952
=-3.08

* 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 $26.0 Mil.
Revenue was 53.638 + 21.047 + 103.124 + 178.058 = $355.9 Mil.
Gross Profit was 53.638 + 21.047 + 103.124 + 178.058 = $355.9 Mil.
Total Current Assets was $355.1 Mil.
Total Assets was $1,216.1 Mil.
Property, Plant and Equipment(Net PPE) was $0.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $6.0 Mil.
Selling, General & Admin. Expense(SGA) was $39.7 Mil.
Total Current Liabilities was $121.5 Mil.
Long-Term Debt was $234.9 Mil.
Net Income was 13.907 + 4.148 + 55.887 + 100.574 = $174.5 Mil.
Non Operating Income was -8.594 + -7.343 + -8.964 + -1.156 = $-26.1 Mil.
Cash Flow from Operations was -8.687 + 2.246 + 92.506 + 70.079 = $156.1 Mil.
Accounts Receivable was $67.8 Mil.
Revenue was 124.618 + 138.066 + 149.706 + 117.075 = $529.5 Mil.
Gross Profit was 124.618 + 138.066 + 149.706 + 117.075 = $529.5 Mil.
Total Current Assets was $306.7 Mil.
Total Assets was $1,020.6 Mil.
Property, Plant and Equipment(Net PPE) was $0.0 Mil.
Depreciation, Depletion and Amortization(DDA) was $0.0 Mil.
Selling, General & Admin. Expense(SGA) was $41.3 Mil.
Total Current Liabilities was $94.6 Mil.
Long-Term Debt was $281.6 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)
=(26.035 / 355.867) / (67.84 / 529.465)
=0.07315935 / 0.12812934
=0.571

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)
=(529.465 / 529.465) / (355.867 / 355.867)
=1 / 1
=1

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 - (355.056 + 0.016) / 1216.066) / (1 - (306.688 + 0.042) / 1020.601)
=0.70801585 / 0.6994614
=1.0122

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
=355.867 / 529.465
=0.6721

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))
=(0.019 / (0.019 + 0.042)) / (6.041 / (6.041 + 0.016))
=0.31147541 / 0.99735843
=0.3123

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)
=(39.749 / 355.867) / (41.271 / 529.465)
=0.11169622 / 0.0779485
=1.4329

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)
=((234.895 + 121.514) / 1216.066) / ((281.581 + 94.589) / 1020.601)
=0.2930836 / 0.36857695
=0.7952

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
=(174.516 - -26.057 - 156.144) / 1216.066
=0.0365

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.

PDL BioPharma Inc has a M-score of -3.08 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.

PDL BioPharma Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 0.8310.19892.30130.07190.4121.2190.58970.69310.762191.6193
GMI 11111111.01290.98731
AQI 0.91660.28990.4131.35511.52271.32292.5962.31640.78571.1454
SGI 1.18231.38211.13621.08151.08421.04951.03451.18261.31231.0159
DEPI 0.82121.23910.17651.11681.05960.81751.0460.94871.45131.2135
SGAI 0.76331.52890.67340.37795.8630.1151.5240.98790.89421.0175
LVGI 1.13050.97865.04640.79030.8470.89640.68590.65440.6440.55
TATA -0.1828-0.0738-0.06150.0035-0.23610.11270.0052-0.01170.08740.0601
M-score -3.38-3.56-3.05-2.91-4.62-1.41-2.14-2.01-1.92173.41

PDL BioPharma Inc Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 158.568844.78120.75834.07787.34211.3315192.56221.45710.0590.571
GMI 1.03571.03141.00790.96420.96550.96960.9796111
AQI 2.56042.89560.78570.94460.84291.07371.14541.16711.11.0122
SGI 1.25361.3781.31871.21071.11680.91741.01090.91540.74960.6721
DEPI 0.92780.92751.45130.99350.99243.16511.21351.57110.99180.3123
SGAI 0.7960.61360.88981.1561.26351.7961.02251.10021.30931.4329
LVGI 0.66470.65980.6440.77120.6710.67360.550.44180.57210.7952
TATA 0.05220.07720.0780.09960.06420.02810.06010.00970.01550.0365
M-score 143.7439.45-1.951.013.74-1.88174.26-1.79-3.37-3.08
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