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GuruFocus has detected 3 Warning Signs with Gazprom PJSC $OGZPY.
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Gazprom PJSC (OTCPK:OGZPY)
Beneish M-Score
-2.47 (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.

Gazprom PJSC has a M-score of -2.47 suggests that the company is not a manipulator.

OGZPY' s Beneish M-Score Range Over the Past 10 Years
Min: -5.41   Max: -2.05
Current: -2.47

-5.41
-2.05

During the past 13 years, the highest Beneish M-Score of Gazprom PJSC was -2.05. The lowest was -5.41. And the median was -2.69.


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 Gazprom PJSC 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 * 0.9722+0.528 * 1.0081+0.404 * 1.0033+0.892 * 1.0043+0.115 * 0.9601
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9429+4.679 * -0.0047-0.327 * 0.8609
=-2.47

* 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 $12,352 Mil.
Revenue was 30545.1960289 + 30114.2015817 + 21150.7992596 + 22328.9247855 = $104,139 Mil.
Gross Profit was 20777.1159347 + 16298.8221437 + 14378.3779236 + 13348.3089349 = $64,803 Mil.
Total Current Assets was $54,250 Mil.
Total Assets was $282,835 Mil.
Property, Plant and Equipment(Net PPE) was $194,176 Mil.
Depreciation, Depletion and Amortization(DDA) was $9,748 Mil.
Selling, General & Admin. Expense(SGA) was $3,818 Mil.
Total Current Liabilities was $27,664 Mil.
Long-Term Debt was $38,660 Mil.
Net Income was 5610.85310449 + 4077.33467945 + 1719.01396601 + 4119.98990409 = $15,527 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 1773.54871277 + 6643.91721353 + 4120.52835268 + 4328.87430591 = $16,867 Mil.
Accounts Receivable was $12,650 Mil.
Revenue was 29233.7876493 + 31416.8096921 + 21752.7343093 + 21288.8944977 = $103,692 Mil.
Gross Profit was 19089.1468955 + 15786.6229177 + 16028.520949 + 14144.8763251 = $65,049 Mil.
Total Current Assets was $67,151 Mil.
Total Assets was $288,546 Mil.
Property, Plant and Equipment(Net PPE) was $186,407 Mil.
Depreciation, Depletion and Amortization(DDA) was $8,966 Mil.
Selling, General & Admin. Expense(SGA) was $4,032 Mil.
Total Current Liabilities was $33,368 Mil.
Long-Term Debt was $45,227 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)
=(12351.5059734 / 104139.121656) / (12649.8906276 / 103692.226148)
=0.11860582 / 0.12199459
=0.9722

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)
=(65049.1670873 / 103692.226148) / (64802.6249369 / 104139.121656)
=0.62732926 / 0.62226975
=1.0081

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 - (54249.6382299 + 194176.089517) / 282834.713108) / (1 - (67151.3713613 + 186407.386842) / 288546.373885)
=0.12165758 / 0.12125474
=1.0033

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
=104139.121656 / 103692.226148
=1.0043

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))
=(8966.46474844 / (8966.46474844 + 186407.386842)) / (9747.77048629 / (9747.77048629 + 194176.089517))
=0.04589388 / 0.04780103
=0.9601

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)
=(3818.42503786 / 104139.121656) / (4032.22278311 / 103692.226148)
=0.03666658 / 0.03888645
=0.9429

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)
=((38659.8182736 + 27663.5537607) / 282834.713108) / ((45227.3599192 + 33368.3493185) / 288546.373885)
=0.23449516 / 0.27238502
=0.8609

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
=(15527.191654 - 0 - 16866.8685849) / 282834.713108
=-0.0047

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.

Gazprom PJSC has a M-score of -2.47 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.

Gazprom PJSC Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 1.04250.85510.97721.0012
GMI 1.05741.0491.17541.0592
AQI 0.9160.95721.03541.0704
SGI 1.10141.06471.08651.0062
DEPI 0.93540.9890.77670.9448
SGAI 0.53670.103111.73050.9159
LVGI 0.95371.26231.07340.8817
TATA 0.0462-0.0349-0.0729-0.0366
M-score -2.05-2.64-4.55-2.54

Gazprom PJSC Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 0.85510.98790.91110.97720.91050.91431.00120.9722
GMI 1.0491.02561.09371.17541.21451.18011.05921.0081
AQI 0.95721.00651.12861.03541.01751.02081.07041.0033
SGI 1.06471.06211.05541.08651.08511.06911.00621.0043
DEPI 0.9890.97030.75690.77670.77140.97480.94480.9601
SGAI 0.10310.06090.322411.730516.42733.30330.91590.9429
LVGI 1.26231.22351.27191.07341.06880.92390.88170.8609
TATA -0.0349-0.0246-0.0683-0.0729-0.0724-0.0594-0.0366-0.0047
M-score -2.64-2.45-2.73-4.55-5.41-3.05-2.54-2.47
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