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Pfizer Inc (NYSE:PFE)
Beneish M-Score
-2.55 (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.

Pfizer Inc has a M-score of -2.55 suggests that the company is not a manipulator.

PFE' s Beneish M-Score Range Over the Past 10 Years
Min: -3.16   Max: -1.49
Current: -2.55

-3.16
-1.49

During the past 13 years, the highest Beneish M-Score of Pfizer Inc was -1.49. The lowest was -3.16. And the median was -2.61.


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 Pfizer 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 * 0.941+0.528 * 1.0442+0.404 * 1.0919+0.892 * 1.0849+0.115 * 1.0733
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9972+4.679 * -0.0234-0.327 * 1.1592
=-2.55

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

This Year (Jun16) TTM:Last Year (Jun15) TTM:
Accounts Receivable was $9,138 Mil.
Revenue was 13147 + 13005 + 14047 + 12087 = $52,286 Mil.
Gross Profit was 9973 + 10154 + 10637 + 9868 = $40,632 Mil.
Total Current Assets was $43,845 Mil.
Total Assets was $170,658 Mil.
Property, Plant and Equipment(Net PPE) was $13,609 Mil.
Depreciation, Depletion and Amortization(DDA) was $5,508 Mil.
Selling, General & Admin. Expense(SGA) was $15,174 Mil.
Total Current Liabilities was $32,099 Mil.
Long-Term Debt was $30,457 Mil.
Net Income was 2019 + 3016 + -172 + 2130 = $6,993 Mil.
Non Operating Income was -1213 + -278 + -1994 + -504 = $-3,989 Mil.
Cash Flow from Operations was 3579 + 1651 + 4713 + 5024 = $14,967 Mil.
Accounts Receivable was $8,951 Mil.
Revenue was 11853 + 10864 + 13118 + 12361 = $48,196 Mil.
Gross Profit was 9673 + 9026 + 10416 + 9993 = $39,108 Mil.
Total Current Assets was $51,715 Mil.
Total Assets was $160,878 Mil.
Property, Plant and Equipment(Net PPE) was $11,432 Mil.
Depreciation, Depletion and Amortization(DDA) was $5,118 Mil.
Selling, General & Admin. Expense(SGA) was $14,027 Mil.
Total Current Liabilities was $24,143 Mil.
Long-Term Debt was $26,729 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)
=(9138 / 52286) / (8951 / 48196)
=0.17476954 / 0.18572081
=0.941

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)
=(39108 / 48196) / (40632 / 52286)
=0.81143663 / 0.77711051
=1.0442

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 - (43845 + 13609) / 170658) / (1 - (51715 + 11432) / 160878)
=0.66333837 / 0.60748518
=1.0919

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
=52286 / 48196
=1.0849

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))
=(5118 / (5118 + 11432)) / (5508 / (5508 + 13609))
=0.30924471 / 0.28812052
=1.0733

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)
=(15174 / 52286) / (14027 / 48196)
=0.29021153 / 0.29104075
=0.9972

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)
=((30457 + 32099) / 170658) / ((26729 + 24143) / 160878)
=0.36655768 / 0.31621477
=1.1592

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
=(6993 - -3989 - 14967) / 170658
=-0.0234

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.

Pfizer Inc has a M-score of -2.55 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.

Pfizer Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.01111.0470.91241.57890.73580.93661.03970.86440.96340.9577
GMI 1.00641.09660.92291.01191.0820.97890.96090.99221.0091.0055
AQI 0.96261.03041.07841.22420.98081.01850.98141.01610.98081.1129
SGI 1.02041.0010.99751.03551.35590.99430.87480.87450.96160.9848
DEPI 1.05910.97190.89681.60330.5620.88421.00811.01171.06481.1745
SGAI 0.99771.00140.93270.98820.97250.99820.97560.98791.02121.0667
LVGI 0.80511.05691.24421.20020.910.97510.95810.97411.00431.1067
TATA 0.011-0.0509-0.0842-0.0396-0.0236-0.0477-0.01340.0246-0.0453-0.0324
M-score -2.34-2.63-3.05-2.00-2.50-2.78-2.63-2.59-2.76-2.66

Pfizer Inc Quarterly Data

Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16
DSRI 0.84140.99450.94780.98380.97630.89981.00030.95770.97540.941
GMI 0.9880.99661.00261.00461.00660.99760.99181.00551.02311.0442
AQI 1.02031.00631.01120.98081.04851.02661.09921.11291.06881.0919
SGI 0.87720.90650.92360.94170.97210.95770.95760.98481.03821.0849
DEPI 1.0241.08221.08241.06481.04341.06641.20461.17451.12481.0733
SGAI 0.99620.98261.0041.01671.02751.03831.00571.06661.02630.9972
LVGI 0.96911.02431.01251.00431.01151.0071.10671.10671.12451.1592
TATA 0.0136-0.0451-0.0351-0.0398-0.0276-0.0294-0.0312-0.0302-0.0313-0.0234
M-score -2.66-2.77-2.75-2.74-2.64-2.74-2.64-2.65-2.61-2.55
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