Switch to:
GuruFocus has detected 1 Warning Sign with Biomarin Pharmaceutical Inc $BMRN.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Biomarin Pharmaceutical Inc (NAS:BMRN)
Beneish M-Score
-2.79 (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.

Biomarin Pharmaceutical Inc has a M-score of -2.79 suggests that the company is not a manipulator.

BMRN' s Beneish M-Score Range Over the Past 10 Years
Min: -5.04   Max: 7.17
Current: -2.79

-5.04
7.17

During the past 13 years, the highest Beneish M-Score of Biomarin Pharmaceutical Inc was 7.17. The lowest was -5.04. And the median was -2.20.


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 Biomarin Pharmaceutical 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 * 0.9939+0.528 * 1.0064+0.404 * 0.8381+0.892 * 1.2816+0.115 * 0.6739
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9243+4.679 * -0.1077-0.327 * 0.8893
=-2.79

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

This Year (Mar17) TTM:Last Year (Mar16) TTM:
Accounts Receivable was $230 Mil.
Revenue was 303.745 + 300.091 + 279.896 + 300.131 = $1,184 Mil.
Gross Profit was 253.739 + 235.944 + 229.158 + 248.514 = $967 Mil.
Total Current Assets was $1,353 Mil.
Total Assets was $3,939 Mil.
Property, Plant and Equipment(Net PPE) was $824 Mil.
Depreciation, Depletion and Amortization(DDA) was $98 Mil.
Selling, General & Admin. Expense(SGA) was $491 Mil.
Total Current Liabilities was $340 Mil.
Long-Term Debt was $668 Mil.
Net Income was -16.29 + -78.711 + -42.797 + -423.56 = $-561 Mil.
Non Operating Income was -4.751 + 4.261 + 1.619 + -1.552 = $-0 Mil.
Cash Flow from Operations was -80.443 + 0.353 + -10.617 + -46.119 = $-137 Mil.
Accounts Receivable was $181 Mil.
Revenue was 236.736 + 227.936 + 208.904 + 250.135 = $924 Mil.
Gross Profit was 193.618 + 179.893 + 174 + 212.072 = $760 Mil.
Total Current Assets was $993 Mil.
Total Assets was $3,667 Mil.
Property, Plant and Equipment(Net PPE) was $717 Mil.
Depreciation, Depletion and Amortization(DDA) was $55 Mil.
Selling, General & Admin. Expense(SGA) was $415 Mil.
Total Current Liabilities was $388 Mil.
Long-Term Debt was $668 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)
=(230.25 / 1183.863) / (180.751 / 923.711)
=0.19449041 / 0.19567917
=0.9939

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)
=(759.583 / 923.711) / (967.355 / 1183.863)
=0.82231672 / 0.81711735
=1.0064

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 - (1352.788 + 824.013) / 3938.607) / (1 - (992.79 + 716.916) / 3666.993)
=0.44731703 / 0.53375804
=0.8381

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
=1183.863 / 923.711
=1.2816

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))
=(55.096 / (55.096 + 716.916)) / (97.598 / (97.598 + 824.013))
=0.07136677 / 0.10589934
=0.6739

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)
=(491.312 / 1183.863) / (414.765 / 923.711)
=0.41500748 / 0.44902031
=0.9243

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)
=((668.437 + 340.206) / 3938.607) / ((668.009 + 388.011) / 3666.993)
=0.2560913 / 0.28797982
=0.8893

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
=(-561.358 - -0.423 - -136.826) / 3938.607
=-0.1077

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.

Biomarin Pharmaceutical Inc has a M-score of -2.79 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.

Biomarin Pharmaceutical Inc Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.80151.31161.23691.01581.03240.9170.98620.89760.96141.0398
GMI 1.05561.03171.03250.98011.00440.99150.97351.00241.00921.0208
AQI 0.72580.42035.6211.5571.02190.79361.01820.63812.3180.8635
SGI 1.44382.43861.0951.1591.1731.13451.09541.36611.18771.255
DEPI 10.7240.11331.29640.85750.9640.85491.33031.25811.28290.5804
SGAI 1.09530.56361.06511.05330.98570.99581.08420.93981.1210.944
LVGI 1.17681.0090.90670.58260.92740.9321.18370.94960.83680.9204
TATA -0.01450.0511-0.08870.1603-0.0521-0.0822-0.0446-0.02520.0155-0.1011
M-score -1.37-0.92-0.65-1.25-2.51-2.90-2.66-2.45-1.67-2.75

Biomarin Pharmaceutical Inc Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 0.89681.13591.110.91710.96230.89231.01611.23761.03980.9939
GMI 1.00221.00511.00151.00921.00941.01811.02781.03161.02081.0064
AQI 0.63811.55531.83051.4182.3181.22220.79570.73940.86350.8381
SGI 1.36731.40061.37091.33791.18661.15271.13261.17121.2551.2816
DEPI 1.25811.00961.06231.17061.28291.07430.75570.57060.58040.6739
SGAI 0.94010.97951.02721.05661.12061.07321.01250.98460.9440.9243
LVGI 0.94960.78270.79350.82520.83681.05361.18310.91870.92040.8893
TATA -0.02790.0017-0.009-0.03960.01550.0227-0.0754-0.0466-0.0988-0.1077
M-score -2.47-1.69-1.68-2.20-1.67-2.26-2.86-2.44-2.73-2.79
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)

GF Chat

FEEDBACK