Switch to:
Sanofi (NYSE:SNY)
Beneish M-Score
-2.38 (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 -2.40 suggests that the company is not a manipulator.

SNY' s 10-Year Beneish M-Score Range
Min: -3.34   Max: 1.7
Current: -2.38

-3.34
1.7

During the past 13 years, the highest Beneish M-Score of Sanofi was 1.70. The lowest was -3.34. And the median was -2.38.


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 * 1+0.528 * 0.9896+0.404 * 1.0118+0.892 * 1.0098+0.115 * 1.0898
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0345+4.679 * 0.0191-0.327 * 1.0648
=-2.40

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

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Accounts Receivable was $8,815 Mil.
Revenue was 11307.02836 + 11427.8350515 + 11067.9347826 + 10961.2724758 = $44,764 Mil.
Gross Profit was 7557.33662145 + 7737.11340206 + 7524.45652174 + 7481.32780083 = $30,300 Mil.
Total Current Assets was $28,887 Mil.
Total Assets was $120,089 Mil.
Property, Plant and Equipment(Net PPE) was $12,819 Mil.
Depreciation, Depletion and Amortization(DDA) was $5,115 Mil.
Selling, General & Admin. Expense(SGA) was $11,953 Mil.
Total Current Liabilities was $16,069 Mil.
Long-Term Debt was $16,370 Mil.
Net Income was 1651.04808878 + 1533.50515464 + 1055.70652174 + 1499.30843707 = $5,740 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 0 + 0 + 3442.93478261 + 0 = $3,443 Mil.
Accounts Receivable was $0 Mil.
Revenue was 11721.5363512 + 11372.4966622 + 10667.5461741 + 10566.0621762 = $44,328 Mil.
Gross Profit was 7740.74074074 + 7535.38050734 + 7138.52242744 + 7277.20207254 = $29,692 Mil.
Total Current Assets was $32,801 Mil.
Total Assets was $131,776 Mil.
Property, Plant and Equipment(Net PPE) was $13,967 Mil.
Depreciation, Depletion and Amortization(DDA) was $6,300 Mil.
Selling, General & Admin. Expense(SGA) was $11,442 Mil.
Total Current Liabilities was $19,145 Mil.
Long-Term Debt was $14,285 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)
=(8815.0431566 / 44764.07067) / (0 / 44327.6413637)
=0.19692229 / 0
=1

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)
=(7737.11340206 / 44327.6413637) / (7557.33662145 / 44764.07067)
=0.66982688 / 0.67688738
=0.9896

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 - (28886.5598027 + 12818.7422935) / 120088.779285) / (1 - (32801.0973937 + 13967.0781893) / 131776.406036)
=0.65271275 / 0.64509447
=1.0118

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
=44764.07067 / 44327.6413637
=1.0098

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))
=(6299.94056738 / (6299.94056738 + 13967.0781893)) / (5115.37872759 / (5115.37872759 + 12818.7422935))
=0.31084693 / 0.28523164
=1.0898

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)
=(11952.9671658 / 44764.07067) / (11442.0370059 / 44327.6413637)
=0.26702145 / 0.2581242
=1.0345

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)
=((16369.9136868 + 16069.0505549) / 120088.779285) / ((14285.3223594 + 19145.4046639) / 131776.406036)
=0.27012486 / 0.25369281
=1.0648

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
=(5739.56820223 - 0 - 3442.93478261) / 120088.779285
=0.0191

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 -2.40 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

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
DSRI 0.6220.9690.9841.0961.0631.03841.12930.91010.98241.0219
GMI 0.97710.98921.00260.99381.00221.02181.05640.99741.0310.9902
AQI 0.98360.98160.96190.93850.99110.97971.02360.97440.96631.0118
SGI 1.60371.15261.09130.9161.1510.94541.08861.0230.96820.9206
DEPI 0.56250.98931.19060.90061.18471.01071.13361.07490.89631.3267
SGAI 0.98970.93990.9510.96170.95770.99161.03081.02191.0381.0338
LVGI 0.83140.81910.98081.00761.1260.93081.3220.94081.03641.0648
TATA -0.0438-0.0383-0.0256-0.0649-0.0406-0.0503-0.0362-0.0319-0.0337-0.0339
M-score -2.51-2.50-2.51-2.81-2.49-2.70-2.51-2.68-2.71-2.68

Sanofi Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
DSRI 01.044910.95221
GMI 0.99711.02261.03161.01160.9896
AQI 0.97440.99170.96630.97951.0118
SGI 0.95950.9350.95291.01381.0098
DEPI 1.10470.99671.00571.12991.0898
SGAI 1.02061.08721.03840.97641.0345
LVGI 0.94080.96841.03641.06891.0648
TATA 0.00720.01330.01730.01770.0191
M-score -3.39-2.43-2.46-2.43-2.40
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)

GuruFocus Premium Plus Membership

FEEDBACK