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GuruFocus has detected 4 Warning Signs with Gazprom PJSC $OGZPY.
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Gazprom PJSC (OTCPK:OGZPY)
Beneish M-Score
-2.54 (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 -2.54 suggests that the company is not a manipulator.

OGZPY' s Beneish M-Score Range Over the Past 10 Years
Min: -3.23   Max: -1.18
Current: -2.54

-3.23
-1.18

During the past 13 years, the highest Beneish M-Score of Gazprom PJSC was -1.18. The lowest was -3.23. And the median was -2.63.


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 * 1.0012+0.528 * 1.0592+0.404 * 1.0704+0.892 * 1.0062+0.115 * 0.9448
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 0.9159+4.679 * -0.0366-0.327 * 0.8817
=-2.54

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

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Accounts Receivable was $12,844 Mil.
Revenue was 31420.0667135 + 22067.9775281 + 23297.1910112 + 30501.4747191 = $107,287 Mil.
Gross Profit was 17005.6004213 + 15001.8785112 + 13927.1418539 + 19916.9241573 = $65,852 Mil.
Total Current Assets was $56,783 Mil.
Total Assets was $297,032 Mil.
Property, Plant and Equipment(Net PPE) was $201,944 Mil.
Depreciation, Depletion and Amortization(DDA) was $10,034 Mil.
Selling, General & Admin. Expense(SGA) was $3,903 Mil.
Total Current Liabilities was $33,740 Mil.
Long-Term Debt was $41,828 Mil.
Net Income was 4254.14325843 + 1793.55688202 + 4298.64817416 + 6360.7619382 = $16,707 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 6932.02247191 + 4299.20997191 + 4516.59058989 + 11838.6060393 = $27,586 Mil.
Accounts Receivable was $12,749 Mil.
Revenue was 32779.1608146 + 22696.0147472 + 22212.0610955 + 28937.0259831 = $106,624 Mil.
Gross Profit was 16471.190309 + 16723.5779494 + 14758.2514045 + 21364.6594101 = $69,318 Mil.
Total Current Assets was $70,115 Mil.
Total Assets was $299,369 Mil.
Property, Plant and Equipment(Net PPE) was $193,186 Mil.
Depreciation, Depletion and Amortization(DDA) was $9,045 Mil.
Selling, General & Admin. Expense(SGA) was $4,235 Mil.
Total Current Liabilities was $37,302 Mil.
Long-Term Debt was $49,084 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)
=(12843.5042135 / 107286.709972) / (12748.5252809 / 106624.26264)
=0.11971198 / 0.11956496
=1.0012

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)
=(69317.679073 / 106624.26264) / (65851.5449438 / 107286.709972)
=0.65011169 / 0.61379033
=1.0592

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 - (56782.7598315 + 201944.294242) / 297031.917135) / (1 - (70114.5014045 + 193186.113062) / 299368.679775)
=0.12895874 / 0.12048042
=1.0704

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
=107286.709972 / 106624.26264
=1.0062

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))
=(9044.94382022 / (9044.94382022 + 193186.113062)) / (10034.4803371 / (10034.4803371 + 201944.294242))
=0.04472579 / 0.04733719
=0.9448

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)
=(3902.84410112 / 107286.709972) / (4234.81390449 / 106624.26264)
=0.0363777 / 0.03971717
=0.9159

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)
=((41828.3532303 + 33739.6067416) / 297031.917135) / ((49084.3223315 + 37301.6327247) / 299368.679775)
=0.25441024 / 0.28856043
=0.8817

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
=(16707.1102528 - 0 - 27586.429073) / 297031.917135
=-0.0366

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 -2.54 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 1.04770.94561.09720.84571.04141.18461.04250.85510.97721.0012
GMI 0.39681111.40610.93411.06191.04431.0430.898
AQI 1.44970.86040.96880.95760.87340.7450.9160.95721.03541.0704
SGI 1.0991.35580.91041.20261.28911.02791.10141.06471.08651.0062
DEPI 1.36821.08011.06981.01711.08050.94410.93080.98831.01290.9448
SGAI 0.06640.82713.46690.95496.97661.12120.82520.22980.87482.9694
LVGI 1.54360.86531.01420.86480.98490.98050.95371.26231.07340.8817
TATA 0.0206-0.0322-0.0076-0.0489-0.0303-0.0208-0.0448-0.1157-0.0729-0.0366
M-score -2.36-2.34-2.94-2.63-3.18-2.54-2.52-3.05-2.73-2.98

Gazprom PJSC Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
DSRI 0.95010.85510.98790.91110.97720.91050.91431.0012
GMI 1.10031.0491.02561.09371.17541.21451.18011.0592
AQI 0.90840.95721.00651.12861.03541.01751.02081.0704
SGI 1.05751.06471.06211.05541.08651.08511.06911.0062
DEPI 0.98990.9890.97030.75690.77670.77140.97480.9448
SGAI 0.61980.10310.06090.322411.730516.42733.30330.9159
LVGI 1.05931.26231.22351.27191.07341.06880.92390.8817
TATA 0.0106-0.0349-0.0246-0.0683-0.0729-0.0724-0.0594-0.0366
M-score -2.36-2.64-2.45-2.73-4.55-5.41-3.05-2.54
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