Switch to:
Sanofi (NYSE:SNY)
Beneish M-Score
-2.73 (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.

Sanofi has a M-score of -2.70 suggests that the company is not a manipulator.

SNY' s 10-Year Beneish M-Score Range
Min: -3.8   Max: 0.97
Current: -2.73

-3.8
0.97

During the past 13 years, the highest Beneish M-Score of Sanofi was 0.97. The lowest was -3.80. And the median was -2.64.


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 Sanofi 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 * 0.9582+0.528 * 1.0114+0.404 * 0.9795+0.892 * 1.0114+0.115 * 0.994
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9753+4.679 * -0.0367-0.327 * 1.0689
=-2.70

* 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 $9,658 Mil.
Revenue was 11023.0040595 + 10946.1325967 + 11641.6893733 + 11620.7366985 = $45,232 Mil.
Gross Profit was 7493.91069012 + 7470.99447514 + 7688.01089918 + 7699.86357435 = $30,353 Mil.
Total Current Assets was $27,563 Mil.
Total Assets was $122,760 Mil.
Property, Plant and Equipment(Net PPE) was $13,654 Mil.
Depreciation, Depletion and Amortization(DDA) was $6,715 Mil.
Selling, General & Admin. Expense(SGA) was $11,598 Mil.
Total Current Liabilities was $19,215 Mil.
Long-Term Debt was $13,685 Mil.
Net Income was 1051.42083897 + 1497.23756906 + 1438.69209809 + 1654.8431105 = $5,642 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 3428.95805142 + 0 + 6715.25885559 + 0 = $10,144 Mil.
Accounts Receivable was $9,966 Mil.
Revenue was 10583.7696335 + 10634.9413299 + 11519.9468085 + 11984.4357977 = $44,723 Mil.
Gross Profit was 7085.07853403 + 7312.90743155 + 7706.11702128 + 8249.02723735 = $30,353 Mil.
Total Current Assets was $27,234 Mil.
Total Assets was $126,946 Mil.
Property, Plant and Equipment(Net PPE) was $13,624 Mil.
Depreciation, Depletion and Amortization(DDA) was $6,641 Mil.
Selling, General & Admin. Expense(SGA) was $11,758 Mil.
Total Current Liabilities was $17,839 Mil.
Long-Term Debt was $13,991 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)
=(9657.64546685 / 45231.562728) / (9965.96858639 / 44723.0935695)
=0.21351563 / 0.22283719
=0.9582

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)
=(7470.99447514 / 44723.0935695) / (7493.91069012 / 45231.562728)
=0.67869031 / 0.67105308
=1.0114

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 - (27562.9228687 + 13653.5859269) / 122760.487145) / (1 - (27234.2931937 + 13624.3455497) / 126946.335079)
=0.66425265 / 0.67814243
=0.9795

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
=45231.562728 / 44723.0935695
=1.0114

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))
=(6641.00618247 / (6641.00618247 + 13624.3455497)) / (6714.70947189 / (6714.70947189 + 13653.5859269))
=0.32770249 / 0.32966477
=0.994

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)
=(11598.3581667 / 45231.562728) / (11758.3841365 / 44723.0935695)
=0.25642179 / 0.26291527
=0.9753

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)
=((13684.7090663 + 19215.1556157) / 122760.487145) / ((13990.8376963 + 17839.0052356) / 126946.335079)
=0.26800044 / 0.25073463
=1.0689

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
=(5642.19361663 - 0 - 10144.216907) / 122760.487145
=-0.0367

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.

Sanofi has a M-score of -2.70 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.

Sanofi Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
DSRI 2.02060.57841.10860.97640.78541.0631.03841.12930.91011.2733
GMI 1.09611.02160.98921.00260.99381.00221.02181.05640.99741.031
AQI 5.67661.05840.98160.96190.93850.99110.97971.02360.97440.9663
SGI 1.94221.75281.10761.12490.88591.14920.97641.05621.0570.949
DEPI 0.70730.6110.98931.19050.90061.18471.01071.13361.07490.8963
SGAI 0.9720.96720.93990.98960.92420.95770.99161.03081.02191.0381
LVGI 1.13510.75310.81910.98081.00751.1260.93081.3220.94081.0364
TATA -0.0956-0.0438-0.0383-0.0404-0.0701-0.0406-0.0503-0.0362-0.0319-0.0337
M-score 0.72-2.32-2.41-2.56-3.14-2.49-2.67-2.54-2.65-2.46

Sanofi Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
DSRI 0.89901.04210.9582
GMI 1.01180.99761.02291.03171.0114
AQI 1.02670.97440.99170.96630.9795
SGI 1.01680.95840.95010.95731.0114
DEPI 1.03211.14461.00170.8830.994
SGAI 0.98481.02131.08821.03850.9753
LVGI 0.87930.94080.96841.03641.0689
TATA -0.0305-0.0305-0.0266-0.0336-0.0367
M-score -2.64-3.56-2.61-2.70-2.70
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK