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GuruFocus has detected 4 Warning Signs with Exxon Mobil Corp $XOM.
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Exxon Mobil Corp (NYSE:XOM)
Beneish M-Score
-2.46 (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.

Exxon Mobil Corp has a M-score of -2.46 suggests that the company is not a manipulator.

XOM' s Beneish M-Score Range Over the Past 10 Years
Min: -3.35   Max: -1.66
Current: -2.46

-3.35
-1.66

During the past 13 years, the highest Beneish M-Score of Exxon Mobil Corp was -1.66. The lowest was -3.35. And the median was -2.59.


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 Exxon Mobil Corp 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 * 1.4398+0.528 * 0.9837+0.404 * 1.0709+0.892 * 0.8409+0.115 * 0.7997
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1167+4.679 * -0.0431-0.327 * 1.0563
=-2.46

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $16,033 Mil.
Revenue was 61016 + 58677 + 57694 + 48707 = $226,094 Mil.
Gross Profit was 18733 + 17496 + 17053 + 15624 = $68,906 Mil.
Total Current Assets was $41,416 Mil.
Total Assets was $330,314 Mil.
Property, Plant and Equipment(Net PPE) was $244,224 Mil.
Depreciation, Depletion and Amortization(DDA) was $22,308 Mil.
Selling, General & Admin. Expense(SGA) was $10,799 Mil.
Total Current Liabilities was $47,638 Mil.
Long-Term Debt was $28,932 Mil.
Net Income was 1680 + 2650 + 1700 + 1810 = $7,840 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 7396 + 5355 + 4519 + 4812 = $22,082 Mil.
Accounts Receivable was $13,243 Mil.
Revenue was 59807 + 67344 + 74113 + 67618 = $268,882 Mil.
Gross Profit was 17712 + 20641 + 21601 + 20660 = $80,614 Mil.
Total Current Assets was $42,623 Mil.
Total Assets was $336,758 Mil.
Property, Plant and Equipment(Net PPE) was $251,605 Mil.
Depreciation, Depletion and Amortization(DDA) was $18,048 Mil.
Selling, General & Admin. Expense(SGA) was $11,501 Mil.
Total Current Liabilities was $53,976 Mil.
Long-Term Debt was $19,925 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)
=(16033 / 226094) / (13243 / 268882)
=0.07091298 / 0.04925209
=1.4398

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)
=(80614 / 268882) / (68906 / 226094)
=0.29981181 / 0.30476704
=0.9837

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 - (41416 + 244224) / 330314) / (1 - (42623 + 251605) / 336758)
=0.13524707 / 0.12629247
=1.0709

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
=226094 / 268882
=0.8409

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))
=(18048 / (18048 + 251605)) / (22308 / (22308 + 244224))
=0.06693046 / 0.08369727
=0.7997

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)
=(10799 / 226094) / (11501 / 268882)
=0.04776332 / 0.04277341
=1.1167

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)
=((28932 + 47638) / 330314) / ((19925 + 53976) / 336758)
=0.23180973 / 0.21944839
=1.0563

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
=(7840 - 0 - 22082) / 330314
=-0.0431

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.

Exxon Mobil Corp has a M-score of -2.46 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.

Exxon Mobil Corp Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 1.14560.68021.72010.94650.73320.95571.00481.14640.72441.4398
GMI 1.01691.07541.2511.00831.05040.98761.0840.99860.93730.9837
AQI 1.07921.03711.1060.87040.90230.96810.99570.99381.00511.0709
SGI 1.07131.180.65061.23391.26930.98820.91170.940.65270.8409
DEPI 0.99160.99411.17321.14561.01761.03440.99321.02810.95730.7997
SGAI 0.97380.90341.42680.80760.80390.93731.01781.04081.39861.1167
LVGI 1.06840.90971.03080.97551.05990.82321.04990.96291.00541.0563
TATA -0.0471-0.0636-0.0393-0.0593-0.0432-0.0338-0.0356-0.036-0.0421-0.0431
M-score -2.48-2.81-2.20-2.59-2.68-2.64-2.70-2.56-3.35-2.46

Exxon Mobil Corp Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 0.94581.14640.90070.99571.05170.72441.18191.21021.21261.4398
GMI 1.00710.99860.99180.97880.95410.93730.93460.94320.97780.9837
AQI 0.93050.99380.97331.02351.03751.00511.01161.0081.0431.0709
SGI 0.98510.940.85560.76260.68040.65270.66970.69480.75880.8409
DEPI 1.0231.02811.0060.98560.9690.95730.96430.93640.94580.7997
SGAI 1.01141.04081.10421.21381.33521.39861.39531.36081.24151.1167
LVGI 0.95360.96290.9440.98480.99671.00541.03851.05871.06121.0563
TATA -0.0388-0.0362-0.0281-0.0368-0.0394-0.0421-0.0412-0.0361-0.0298-0.0431
M-score -2.73-2.56-2.85-2.90-2.97-3.35-2.91-2.84-2.70-2.46
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