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Cardinal Health Beneish M-Score

: -2.45 (As of Today)
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The zones of discrimination for M-Score is as such:

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator.
An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Good Sign:

Beneish M-Score -2.45 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Cardinal Health's Beneish M-Score or its related term are showing as below:

NYSE:CAH' s Beneish M-Score Range Over the Past 10 Years
Min: -2.98   Med: -2.41   Max: 1.17
Current: -2.45

-2.98
1.17

During the past 13 years, the highest Beneish M-Score of Cardinal Health was 1.17. The lowest was -2.98. And the median was -2.41.


Cardinal Health Beneish M-Score Historical Data

The historical data trend for Cardinal Health's Beneish M-Score can be seen below:

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

* Premium members only.

Cardinal Health Annual Data
Trend Jun12 Jun13 Jun14 Jun15 Jun16 Jun17 Jun18 Jun19 Jun20 Jun21
Beneish M-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.43 -2.53 -2.53 -2.50 -2.45

Cardinal Health Quarterly Data
Sep16 Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.50 -2.57 -2.58 -2.56 -2.45

Competitive Comparison

For the Medical Distribution subindustry, Cardinal Health's Beneish M-Score, along with its competitors' market caps and Beneish M-Score data, can be viewed below:

* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.

   

Cardinal Health Beneish M-Score Distribution

For the Medical Distribution industry and Healthcare sector, Cardinal Health's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Cardinal Health's Beneish M-Score falls into.



Cardinal Health Beneish M-Score Calculation

The M-score was created by Professor Messod Beneish. Instead of measuring the bankruptcy risk (Altman Z-Score) or business trend (Piotroski 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 Cardinal Health 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 * 1.0368+0.528 * 1.0765+0.404 * 0.8129+0.892 * 1.0624+0.115 * 1.1177
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9332+4.679 * -0.0119-0.327 * 0.9958
=-2.45

* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.

This Year (Jun21) TTM:Last Year (Jun20) TTM:
Accounts Receivable was $9,103 Mil.
Revenue was 42586 + 39275 + 41541 + 39065 = $162,467 Mil.
Gross Profit was 1475 + 1812 + 1776 + 1715 = $6,778 Mil.
Total Current Assets was $31,048 Mil.
Total Assets was $44,453 Mil.
Property, Plant and Equipment(Net PPE) was $2,360 Mil.
Depreciation, Depletion and Amortization(DDA) was $783 Mil.
Selling, General, & Admin. Expense(SGA) was $4,533 Mil.
Total Current Liabilities was $27,624 Mil.
Long-Term Debt & Capital Lease Obligation was $5,365 Mil.
Net Income was 116 + 119 + 629 + -253 = $611 Mil.
Non Operating Income was -77 + -96 + -40 + -1078 = $-1,291 Mil.
Cash Flow from Operations was 665 + 277 + 1217 + 270 = $2,429 Mil.
Accounts Receivable was $8,264 Mil.
Revenue was 36689 + 39157 + 39735 + 37341 = $152,922 Mil.
Gross Profit was 1590 + 1885 + 1714 + 1679 = $6,868 Mil.
Total Current Assets was $25,940 Mil.
Total Assets was $40,766 Mil.
Property, Plant and Equipment(Net PPE) was $2,366 Mil.
Depreciation, Depletion and Amortization(DDA) was $913 Mil.
Selling, General, & Admin. Expense(SGA) was $4,572 Mil.
Total Current Liabilities was $23,615 Mil.
Long-Term Debt & Capital Lease Obligation was $6,765 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Accounts Receivable 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)
=(9103 / 162467) / (8264 / 152922)
=0.05602984 / 0.05404062
=1.0368

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)
=(6868 / 152922) / (6778 / 162467)
=0.04491179 / 0.04171924
=1.0765

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 Property, Plant and Equipment to Total Assets.

AQI=(1 - (CurrentAssets_t + PPE_t) / TotalAssets_t) / (1 - (CurrentAssets_t-1 + PPE_t-1) / TotalAssets_t-1)
=(1 - (31048 + 2360) / 44453) / (1 - (25940 + 2366) / 40766)
=0.24846467 / 0.30564686
=0.8129

4. SGI = Sales Growth Index

Ratio of Revenue 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
=162467 / 152922
=1.0624

5. DEPI = Depreciation Index

Measured as the ratio of the rate of Depreciation, Depletion and Amortization 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))
=(913 / (913 + 2366)) / (783 / (783 + 2360))
=0.27843855 / 0.24912504
=1.1177

Note: If the Depreciation, Depletion and Amortization data is not available, we assume that the depreciation rate is constant and set the Depreciation Index to 1.

6. SGAI = Sales, General and Administrative expenses Index

The ratio of Selling, General, & Admin. Expense(SGA) to Sales 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)
=(4533 / 162467) / (4572 / 152922)
=0.02790105 / 0.02989759
=0.9332

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 in leverage

LVGI=((LTD_t + CurrentLiabilities_t) / TotalAssets_t) / ((LTD_t-1 + CurrentLiabilities_t-1) / TotalAssets_t-1)
=((5365 + 27624) / 44453) / ((6765 + 23615) / 40766)
=0.74210964 / 0.74522887
=0.9958

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
=(611 - -1291 - 2429) / 44453
=-0.0119

An M-Score of equal or less than -1.78 suggests that the company is unlikely to be a manipulator. An M-Score of greater than -1.78 signals that the company is likely to be a manipulator.

Cardinal Health has a M-score of -2.45 suggests that the company is unlikely to be a manipulator.


Cardinal Health Beneish M-Score Related Terms

Thank you for viewing the detailed overview of Cardinal Health's Beneish M-Score provided by GuruFocus.com. Please click on the following links to see related term pages.


Cardinal Health Business Description

Cardinal Health logo
Industry
Healthcare » Medical Distribution NAICS : 424210 SIC : 5122
Address
7000 Cardinal Place, Dublin, OH, USA, 43017
Cardinal Health is the third- largest global logistics provider engaged in wholesale pharmaceutical and medical products. Similar to its closest two peers, the company has evolved over time and has become entrenched in the sourcing and distribution of brand-name and generic pharmaceuticals and related services to hospitals, healthcare systems, pharmacies, ambulatory surgery centers, clinical laboratories, and physician offices. Through acquisitions, Cardinal Health has the ability to manufacture commodity products and certain medical devices.
Executives
Losh J Michael director H.B. FULLER COMPANY P.O. BOX 64683 ST. PAUL MN 55164-0683
Scarborough Dean A director 150 N. ORANGE GROVE BLVD PASADENA CA 91103
Snow Ola M officer: Chief Human Resources Officer 7000 CARDINAL PLACE DUBLIN OH 43017
Edison Sheri H. director 1069 STATE ROUTE 46 EAST BATESVILLE IN 47006
English Patricia M officer: Chief Accounting Officer 7000 CARDINAL PLACE DUBLIN OH 43017
Mason Stephen M officer: CEO, Medical Segment 7000 CARDINAL PLACE DUBLIN OH 43017
Mayer Jessica L officer: Chief Legal/Compliance Officer 7000 CARDINAL PLACE DUBLIN OH 43017
Rice Brian S officer: Chief Information Officer 7000 CARDINAL PLACE DUBLIN OH 43017
Holcomb Michele officer: EVP - Strategy & Corp. Dev. 7000 CARDINAL PLACE DUBLIN OH 43017
Hollar Jason M. officer: Chief Financial Officer 3333 BEVERLY ROAD HOFFMAN ESTATES IL 60179
Kaufmann Michael C director, officer: CEO 7000 CARDINAL PLACE DUBLIN OH 43017
Crawford Victor L. officer: CEO, Pharmaceutical Segment C/O THE PEPSI BOTTLING GROUP, INC. ONE PEPSI WAY SOMERS NY 10589
Laws Stuart G officer: SVP & Chief Accounting Officer CARDINAL HEALTH, INC. 7000 CARDINAL PLACE DUBLIN OH 43017
Evans David C director C/O THE SCOTTS MIRACLE-GRO COMPANY 14111 SCOTTSLAWN ROAD MARYSVILLE OH 43041
Darden Calvin director 11235 STROUP ROAD ROSWELL GA 30075

Cardinal Health Headlines

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