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Pfizer Inc (NYSE:PFE)
Beneish M-Score
-2.53 (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 -2.53 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: -2.53

-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 -2.56.


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 * 0.9285+0.528 * 1.0636+0.404 * 1.0812+0.892 * 1.1111+0.115 * 0.9067
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0128+4.679 * -0.022-0.327 * 1.0968
=-2.53

* 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 $9,836 Mil.
Revenue was 13045 + 13147 + 13005 + 14047 = $53,244 Mil.
Gross Profit was 9960 + 9973 + 10154 + 10637 = $40,724 Mil.
Total Current Assets was $38,501 Mil.
Total Assets was $178,430 Mil.
Property, Plant and Equipment(Net PPE) was $13,284 Mil.
Depreciation, Depletion and Amortization(DDA) was $5,632 Mil.
Selling, General & Admin. Expense(SGA) was $15,463 Mil.
Total Current Liabilities was $34,759 Mil.
Long-Term Debt was $30,437 Mil.
Net Income was 1320 + 2019 + 3016 + -172 = $6,183 Mil.
Non Operating Income was -1780 + -1213 + -278 + -1267 = $-4,538 Mil.
Cash Flow from Operations was 4699 + 3579 + 1651 + 4722 = $14,651 Mil.
Accounts Receivable was $9,535 Mil.
Revenue was 12087 + 11853 + 10864 + 13118 = $47,922 Mil.
Gross Profit was 9868 + 9673 + 9026 + 10416 = $38,983 Mil.
Total Current Assets was $45,001 Mil.
Total Assets was $170,867 Mil.
Property, Plant and Equipment(Net PPE) was $13,695 Mil.
Depreciation, Depletion and Amortization(DDA) was $5,064 Mil.
Selling, General & Admin. Expense(SGA) was $13,741 Mil.
Total Current Liabilities was $27,845 Mil.
Long-Term Debt was $29,079 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)
=(9836 / 53244) / (9535 / 47922)
=0.18473443 / 0.19896916
=0.9285

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)
=(38983 / 47922) / (40724 / 53244)
=0.81346772 / 0.76485613
=1.0636

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 - (38501 + 13284) / 178430) / (1 - (45001 + 13695) / 170867)
=0.70977414 / 0.65648136
=1.0812

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
=53244 / 47922
=1.1111

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))
=(5064 / (5064 + 13695)) / (5632 / (5632 + 13284))
=0.26995042 / 0.29773737
=0.9067

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)
=(15463 / 53244) / (13741 / 47922)
=0.2904177 / 0.28673678
=1.0128

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)
=((30437 + 34759) / 178430) / ((29079 + 27845) / 170867)
=0.36538699 / 0.333148
=1.0968

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
=(6183 - -4538 - 14651) / 178430
=-0.022

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 -2.53 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.

Pfizer Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
DSRI 1.01111.0470.91241.57890.76570.95410.91290.92880.93360.9882
GMI 1.00641.09660.92291.01191.06360.97220.96941.00761.0091.0055
AQI 0.96261.03041.07841.22420.98080.99990.97991.03660.99481.097
SGI 1.02041.0010.99751.03551.30310.93660.89550.94380.96160.9848
DEPI 1.05910.97190.89681.60330.56610.84350.98631.07631.06481.1745
SGAI 0.99771.00140.93270.98820.97880.98930.96361.00261.02121.0667
LVGI 0.80511.05691.24421.20020.910.9880.95460.9651.01371.0955
TATA 0.011-0.0509-0.0842-0.0396-0.0236-0.05440.00380.0161-0.0458-0.0324
M-score -2.34-2.63-3.05-2.00-2.53-2.86-2.64-2.48-2.79-2.64

Pfizer Inc Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
DSRI 0.93550.90810.93360.97630.89981.00030.98820.97540.9410.9285
GMI 1.00911.01161.0091.00660.99760.99181.00551.02311.04421.0636
AQI 1.00631.01120.99481.04851.02661.09921.0971.06881.09191.0812
SGI 0.96360.96390.96160.97210.95770.95760.98481.03821.08491.1111
DEPI 1.12081.12841.06481.04341.05411.19011.17451.12481.07330.9067
SGAI 1.00021.0181.02121.02751.03831.00571.06661.02630.99721.0128
LVGI 1.02431.01251.01371.01151.0071.10671.09551.12451.15921.0968
TATA -0.0509-0.0432-0.0464-0.0353-0.0372-0.0342-0.0324-0.0323-0.0242-0.022
M-score -2.80-2.78-2.79-2.67-2.78-2.66-2.64-2.61-2.55-2.53
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