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ConocoPhillips  (NYSE:COP) Beneish M-Score: -3.62 (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.

ConocoPhillips has a M-score of -3.62 suggests that the company is not a manipulator.

NYSE:COP' s Beneish M-Score Range Over the Past 10 Years
Min: -6.11   Max: -0.77
Current: -3.62

-6.11
-0.77

During the past 13 years, the highest Beneish M-Score of ConocoPhillips was -0.77. The lowest was -6.11. And the median was -2.72.


Historical Data

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

* Premium members only.

ConocoPhillips Annual Data

Dec08 Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.85 -3.03 -6.11 -3.20 -3.62

ConocoPhillips Quarterly Data

Mar13 Jun13 Sep13 Dec13 Mar14 Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17 Dec17
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 -3.20 -1.98 -7.21 -5.61 -3.62

Competitive Comparison
* 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.


ConocoPhillips Distribution

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



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 ConocoPhillips 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 * 1.0464+0.528 * -0.9844+0.404 * 0.5985+0.892 * 1.2285+0.115 * 1.0319
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.6316+4.679 * -0.0537-0.327 * 0.9808
=-3.62

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

This Year (Dec17) TTM:Last Year (Dec16) TTM:
Accounts Receivable was USD 4,183 Mil.
Revenue was 5832 + 6999 + 8704 + 7571 = USD 29,106 Mil.
Gross Profit was -6710 + 2849 + 4455 + 3081 = USD 3,675 Mil.
Total Current Assets was USD 16,512 Mil.
Total Assets was USD 73,362 Mil.
Property, Plant and Equipment(Net PPE) was USD 45,683 Mil.
Depreciation, Depletion and Amortization(DDA) was USD 6,845 Mil.
Selling, General, & Admin. Expense(SGA) was USD 561 Mil.
Total Current Liabilities was USD 9,397 Mil.
Long-Term Debt & Capital Lease Obligation was USD 17,128 Mil.
Net Income was 1579 + 420 + -3440 + 586 = USD -855 Mil.
Non Operating Income was 2225 + 134 + -6363 + 15 = USD -3,989 Mil.
Cash Flow from Operations was 2481 + 1055 + 1751 + 1790 = USD 7,077 Mil.
Accounts Receivable was USD 3,254 Mil.
Revenue was 6458 + 6576 + 5495 + 5164 = USD 23,693 Mil.
Gross Profit was -8809 + 2231 + 2048 + 1585 = USD -2,945 Mil.
Total Current Assets was USD 8,609 Mil.
Total Assets was USD 89,772 Mil.
Property, Plant and Equipment(Net PPE) was USD 58,331 Mil.
(DDA) was USD 9,062 Mil.
Selling, General, & Admin. Expense(SGA) was USD 723 Mil.
Total Current Liabilities was USD 6,909 Mil.
Long-Term Debt & Capital Lease Obligation was USD 26,186 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)
=(4183 / 29106) / (3254 / 23693)
=0.14371607 / 0.13734014
=1.0464

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)
=(-2945 / 23693) / (3675 / 29106)
=-0.12429832 / 0.12626263
=-0.9844

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 - (16512 + 45683) / 73362) / (1 - (8609 + 58331) / 89772)
=0.15221777 / 0.2543332
=0.5985

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
=29106 / 23693
=1.2285

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))
=(9062 / (9062 + 58331)) / (6845 / (6845 + 45683))
=0.134465 / 0.13031145
=1.0319

6. SGAI = Sales, General and Administrative expenses Index

The ratio of c 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)
=(561 / 29106) / (723 / 23693)
=0.01927438 / 0.03051534
=0.6316

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)
=((17128 + 9397) / 73362) / ((26186 + 6909) / 89772)
=0.36156321 / 0.36865615
=0.9808

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
=(-855 - -3989 - 7077) / 73362
=-0.0537

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.

ConocoPhillips has a M-score of -3.62 suggests that the company will not be a manipulator.


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