Switch to:
GuruFocus has detected 2 Warning Signs with Occidental Petroleum Corp $OXY.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Occidental Petroleum Corp (NYSE:OXY)
Beneish M-Score
-2.37 (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.

Occidental Petroleum Corp has a M-score of -2.37 suggests that the company is not a manipulator.

OXY' s Beneish M-Score Range Over the Past 10 Years
Min: -3.56   Max: -0.95
Current: -2.37

-3.56
-0.95

During the past 13 years, the highest Beneish M-Score of Occidental Petroleum Corp was -0.95. The lowest was -3.56. And the median was -2.73.


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 Occidental Petroleum Corp 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 * 1.6629+0.528 * 1.03+0.404 * 0.966+0.892 * 0.9336+0.115 * 1.1236
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.1573+4.679 * -0.071-0.327 * 1.2871
=-2.37

* 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 $4,316 Mil.
Revenue was 2978 + 2826 + 2733 + 2558 = $11,095 Mil.
Gross Profit was 1552 + 1500 + 1395 + 1314 = $5,761 Mil.
Total Current Assets was $8,238 Mil.
Total Assets was $42,465 Mil.
Property, Plant and Equipment(Net PPE) was $32,005 Mil.
Depreciation, Depletion and Amortization(DDA) was $4,108 Mil.
Selling, General & Admin. Expense(SGA) was $1,330 Mil.
Total Current Liabilities was $6,852 Mil.
Long-Term Debt was $9,322 Mil.
Net Income was 117 + -272 + -241 + -139 = $-535 Mil.
Non Operating Income was -34 + -560 + -246 + -27 = $-867 Mil.
Cash Flow from Operations was 652 + 915 + 650 + 1129 = $3,346 Mil.
Accounts Receivable was $2,780 Mil.
Revenue was 2281 + 2843 + 3246 + 3514 = $11,884 Mil.
Gross Profit was 1000 + 1489 + 1833 + 2034 = $6,356 Mil.
Total Current Assets was $8,237 Mil.
Total Assets was $42,018 Mil.
Property, Plant and Equipment(Net PPE) was $31,505 Mil.
Depreciation, Depletion and Amortization(DDA) was $4,617 Mil.
Selling, General & Admin. Expense(SGA) was $1,231 Mil.
Total Current Liabilities was $6,826 Mil.
Long-Term Debt was $5,608 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)
=(4316 / 11095) / (2780 / 11884)
=0.38900406 / 0.23392797
=1.6629

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)
=(6356 / 11884) / (5761 / 11095)
=0.53483676 / 0.5192429
=1.03

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 - (8238 + 32005) / 42465) / (1 - (8237 + 31505) / 42018)
=0.05232544 / 0.05416726
=0.966

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
=11095 / 11884
=0.9336

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))
=(4617 / (4617 + 31505)) / (4108 / (4108 + 32005))
=0.12781684 / 0.11375405
=1.1236

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)
=(1330 / 11095) / (1231 / 11884)
=0.11987382 / 0.10358465
=1.1573

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)
=((9322 + 6852) / 42465) / ((5608 + 6826) / 42018)
=0.38087837 / 0.2959208
=1.2871

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
=(-535 - -867 - 3346) / 42465
=-0.071

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.

Occidental Petroleum Corp has a M-score of -2.37 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.

Occidental Petroleum Corp Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 1.33530.50912.16470.95910.85161.08911.08580.72461.22041.6403
GMI 0.95610.96231.07650.96110.96181.02570.97031.081.18891.0838
AQI 0.68821.12121.11180.9630.86740.88070.8011.4261.15550.9968
SGI 1.12041.23110.60651.28211.2590.83671.0631.02310.57860.8188
DEPI 0.92511.07140.975311.09011.13120.920.72290.77131.0771
SGAI 0.96920.58651.94170.83760.86651.0721.06330.95151.46031.279
LVGI 0.97220.89851.03841.2060.93280.96860.99311.2111.1771.1896
TATA -0.0437-0.0907-0.0674-0.0939-0.0888-0.1031-0.0975-0.0439-0.019-0.0702
M-score -2.41-3.01-2.17-2.78-2.82-3.05-2.91-2.80-2.74-2.44

Occidental Petroleum Corp Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 0.72460.60080.76880.81251.22041.52841.28011.55881.64031.6629
GMI 1.081.06621.22231.35661.18891.24321.23241.23751.08381.03
AQI 1.4261.58351.57081.52671.15551.01611.06091.10830.99680.966
SGI 1.02310.97580.88710.87020.57860.59290.61210.64410.81880.9336
DEPI 0.72290.67350.61060.50260.77130.75960.76460.84111.07711.1236
SGAI 0.95151.04511.13781.1971.46031.3871.41091.43081.2791.1573
LVGI 1.2111.12421.21061.24941.1771.21031.18591.17851.18961.2871
TATA -0.0439-0.0303-0.024-0.0021-0.019-0.0217-0.0366-0.0479-0.0702-0.071
M-score -2.80-2.83-2.70-2.55-2.74-2.49-2.75-2.49-2.44-2.37
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
FEEDBACK