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McKesson Beneish M-Score

: -2.78 (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 -2.78 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

MCK' s Beneish M-Score Range Over the Past 10 Years
Min: -2.9   Med: -2.44   Max: 0.12
Current: -2.78

During the past 13 years, the highest Beneish M-Score of McKesson was 0.12. The lowest was -2.90. And the median was -2.44.


McKesson Beneish M-Score Historical Data

The historical data trend for McKesson'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.

McKesson Annual Data
Trend Mar13 Mar14 Mar15 Mar16 Mar17 Mar18 Mar19 Mar20 Mar21 Mar22
Beneish M-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.46 -2.46 -2.37 - -2.77

McKesson Quarterly Data
Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19 Jun19 Sep19 Dec19 Mar20 Jun20 Sep20 Dec20 Mar21 Jun21 Sep21 Dec21 Mar22 Jun22
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 -2.90 -2.74 -2.88 -2.77 -2.78

Competitive Comparison

For the Medical Distribution subindustry, McKesson'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.

   

McKesson Beneish M-Score Distribution

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

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



McKesson 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 McKesson 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 * 0.9+0.528 * 1.0412+0.404 * 0.8951+0.892 * 1.0947+0.115 * 1.0213
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.0436+4.679 * -0.0545-0.327 * 1.0366
=-2.78

* 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 (Jun22) TTM:Last Year (Jun21) TTM:
Total Receivables was $19,900 Mil.
Revenue was 67154 + 66102 + 68614 + 66576 = $268,446 Mil.
Gross Profit was 3023 + 3318 + 3428 + 3352 = $13,121 Mil.
Total Current Assets was $45,383 Mil.
Total Assets was $62,295 Mil.
Property, Plant and Equipment(Net PPE) was $3,681 Mil.
Depreciation, Depletion and Amortization(DDA) was $690 Mil.
Selling, General, & Admin. Expense(SGA) was $10,264 Mil.
Total Current Liabilities was $47,201 Mil.
Long-Term Debt & Capital Lease Obligation was $6,340 Mil.
Net Income was 768 + 368 + -7 + 267 = $1,396 Mil.
Non Operating Income was -13 + -107 + -5 + -196 = $-321 Mil.
Cash Flow from Operations was -941 + 2887 + 1377 + 1792 = $5,115 Mil.
Total Receivables was $20,198 Mil.
Revenue was 62674 + 59142 + 62599 + 60808 = $245,223 Mil.
Gross Profit was 3032 + 3297 + 3151 + 3000 = $12,480 Mil.
Total Current Assets was $43,350 Mil.
Total Assets was $62,894 Mil.
Property, Plant and Equipment(Net PPE) was $4,620 Mil.
Depreciation, Depletion and Amortization(DDA) was $888 Mil.
Selling, General, & Admin. Expense(SGA) was $8,984 Mil.
Total Current Liabilities was $43,835 Mil.
Long-Term Debt & Capital Lease Obligation was $8,312 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Total 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)
=(19900 / 268446) / (20198 / 245223)
=0.07413037 / 0.08236585
=0.9

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)
=(12480 / 245223) / (13121 / 268446)
=0.05089245 / 0.04887761
=1.0412

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 - (45383 + 3681) / 62295) / (1 - (43350 + 4620) / 62894)
=0.21239265 / 0.23728814
=0.8951

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
=268446 / 245223
=1.0947

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))
=(888 / (888 + 4620)) / (690 / (690 + 3681))
=0.16122004 / 0.15785861
=1.0213

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)
=(10264 / 268446) / (8984 / 245223)
=0.03823488 / 0.03663604
=1.0436

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)
=((6340 + 47201) / 62295) / ((8312 + 43835) / 62894)
=0.85947508 / 0.82912519
=1.0366

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
=(1396 - -321 - 5115) / 62295
=-0.0545

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.

McKesson has a M-score of -2.78 suggests that the company is unlikely to be a manipulator.


McKesson Beneish M-Score Related Terms

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


McKesson Business Description

McKesson logo
Address
6555 State Highway 161, Irving, TX, USA, 75039
McKesson is a leading wholesaler of branded, generic, and specialty pharmaceutical products to pharmacies (retail chains, independent, and mail order), hospitals networks, and healthcare providers. Along with AmerisourceBergen and Cardinal Health, the three account for well over 90% of the U.S. pharmaceutical wholesale industry. McKesson is currently divesting from its pharmaceutical wholesale and distribution in Europe and Canada in order to redeploy capital to strategic growth areas in the U.S. (oncology network and ecosystem, and biopharma services). Additionally, the company supplies medical-surgical products and equipment to healthcare facilities and provides a variety of technology solutions for pharmacies.
Executives
Rodgers Thomas L officer: EVP, Chief Strategy & BDO 6555 NORTH STATE HWY 161 IRVING TX 75039
Dunbar Webster Roy director 5757 N. GREEN BAY AVENUE MILWAUKEE WI 53209
Rutledge Napoleon B Jr officer: SVP, Controller & CAO 2999 WILDWOOD PARKWAY ATLANTA GA 30339
Flores Nancy officer: EVP, CIO & CTO 6555 NORTH STATE HWY 161 IRVING TX 75039
Hinton James H. director 6555 NORTH STATE HWY. 161 IRVING TX 75039
Wilson-thompson Kathleen director PO BOX 3599 BATTLE CREEK MI 49016-3599
Faber Tracy officer: EVP & Chief HR Officer 6555 NORTH STATE HWY 161 IRVING TX 75039
Tyler Brian S. officer: Chief Executive Officer MCKESSON CORPORATION 6555 STATE HWY 161 IRVING TX 75039
Schechter Lori A. officer: EVP, Chief Legal Officer & GC MCKESSON CORPORATION 6555 NORTH STATE HWY 161 IRVING TX 75039
Vitalone Britt J. officer: EVP & CFO MCKESSON CORPORATION 6555 STATE HWY 161 IRVING TX 75039
Emerson Kevin officer: SVP, Controller & CAO 6555 NORTH STATE HWY 161 IRVING TX 75039
Carmona Richard H director 1221 BROADWAY OAKLAND CA 94612
Mantia Linda Provie director C/O CERIDIAN HCM HOLDING INC., 3311 EAST OLD SHAKOPEE ROAD MINNEAPOLIS MN 55425
Martinez Maria director THE LANDMARK @ 1 MARKET STREET SUITE 300 SAN FRANCISCO CA 94105
Washington Kenneth E director 6555 STATE HWY 161 IRVING TX 75039

McKesson Headlines

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