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GuruFocus has detected 2 Warning Signs with Pengrowth Energy Corp $PGH.
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Pengrowth Energy Corp (NYSE:PGH)
Beneish M-Score
-2.86 (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.

Pengrowth Energy Corp has a M-score of -2.89 suggests that the company is not a manipulator.

PGH' s Beneish M-Score Range Over the Past 10 Years
Min: -10000000   Max: 10000000
Current: -2.86

-10000000
10000000

During the past 13 years, the highest Beneish M-Score of Pengrowth Energy Corp was 10000000.00. The lowest was -10000000.00. And the median was -2.74.


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 Pengrowth Energy 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 * 1.6965+0.528 * 1.9189+0.404 * 1.4395+0.892 * 0.4446+0.115 * 0.9446
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.9327+4.679 * -0.2239-0.327 * 1.0046
=-2.89

* 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 $69.2 Mil.
Revenue was 152.087846418 + 105.929979759 + 125.953616112 + -7.75554521483 = $376.2 Mil.
Gross Profit was 88.8922088593 + 36.7343878851 + 59.5819346964 + -71.9714595936 = $113.2 Mil.
Total Current Assets was $330.0 Mil.
Total Assets was $2,552.0 Mil.
Property, Plant and Equipment(Net PPE) was $2,017.9 Mil.
Depreciation, Depletion and Amortization(DDA) was $259.1 Mil.
Selling, General & Admin. Expense(SGA) was $61.1 Mil.
Total Current Liabilities was $304.1 Mil.
Long-Term Debt was $784.9 Mil.
Net Income was -64.4655262568 + -69.270560012 + -40.3570338724 + -134.481154025 = $-308.6 Mil.
Non Operating Income was -35.9303802196 + -21.0660469301 + -10.8330790357 + -5.81665891112 = $-73.6 Mil.
Cash Flow from Operations was 49.0774632106 + 99.0329110128 + 109.780286848 + 78.5636730262 = $336.5 Mil.
Accounts Receivable was $91.7 Mil.
Revenue was 174.655980644 + 220.301903303 + 314.262023217 + 136.999595633 = $846.2 Mil.
Gross Profit was 108.876455467 + 140.013126231 + 221.996080205 + 17.8730287101 = $488.8 Mil.
Total Current Assets was $286.0 Mil.
Total Assets was $3,352.5 Mil.
Property, Plant and Equipment(Net PPE) was $2,880.2 Mil.
Depreciation, Depletion and Amortization(DDA) was $346.9 Mil.
Selling, General & Admin. Expense(SGA) was $71.1 Mil.
Total Current Liabilities was $279.1 Mil.
Long-Term Debt was $1,144.9 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)
=(69.1715843729 / 376.215897074) / (91.7132920006 / 846.219502798)
=0.18386141 / 0.10838003
=1.6965

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)
=(488.758690612 / 846.219502798) / (113.237071847 / 376.215897074)
=0.57757909 / 0.3009896
=1.9189

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 - (330.021662807 + 2017.85314111) / 2552.02808695) / (1 - (286.027521548 + 2880.16029034) / 3352.48752457)
=0.07999649 / 0.05557059
=1.4395

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
=376.215897074 / 846.219502798
=0.4446

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))
=(346.880442424 / (346.880442424 + 2880.16029034)) / (259.107469989 / (259.107469989 + 2017.85314111))
=0.10749181 / 0.11379532
=0.9446

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)
=(61.0950816675 / 376.215897074) / (71.1017590189 / 846.219502798)
=0.16239367 / 0.08402283
=1.9327

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)
=((784.865914693 + 304.100993501) / 2552.02808695) / ((1144.86617269 + 279.071525783) / 3352.48752457)
=0.42670647 / 0.42474064
=1.0046

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
=(-308.574274166 - -73.6461650965 - 336.454334097) / 2552.02808695
=-0.2239

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.

Pengrowth Energy Corp has a M-score of -2.89 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.

Pengrowth Energy Corp Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
DSRI 0.97230.75461.69520.80860.93471.1271.01360.58771.44051.5973
GMI 0.71541.33641.23160.91091.04551.0061.11840.73341.15161.6032
AQI 0.83521.06111.07451.62930.5670.74761.0950.63350.85510.9408
SGI 1.61151.03040.63681.21011.01221.10510.89371.20890.48960.4897
DEPI 0.70081.07110.92571.3021.20661.02310.85321.1070.84181.1131
SGAI 7.19780.42850.46840.67641.43991.2711.04610.74461.70751.7603
LVGI 1.4921.14970.79510.86130.94431.17241.12111.16381.24621.0245
TATA -0.0761-0.1115-0.1165-0.1284-0.107-0.078-0.1011-0.1839-0.2868-0.1856
M-score -3.79-2.94-2.41-2.73-3.21-2.83-3.00-3.82-4.07-3.09

Pengrowth Energy Corp Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
DSRI 0.58610.49990.5970.7081.41621.44871.33541.85381.65741.6965
GMI 0.73870.68640.63660.69121.15841.1151.13281.44431.60271.9189
AQI 0.63350.51410.4960.55130.85510.93921.04360.86790.94081.4395
SGI 1.21221.2241.17821.06030.4980.52140.48720.38460.4720.4446
DEPI 1.09491.03640.9890.8710.82780.8970.9391.08021.15430.9446
SGAI 0.75170.76070.81190.86521.71971.52281.53691.86011.74351.9327
LVGI 1.16381.12721.18011.29621.24621.10151.06630.99931.02451.0046
TATA -0.1883-0.1887-0.2071-0.2992-0.2982-0.2814-0.2915-0.2463-0.1888-0.2239
M-score -3.84-3.98-4.08-4.53-4.14-3.91-4.03-3.35-3.05-2.89
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