Covance Beneish M-Score Historical Data
The historical data trend for Covance'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.
Covance Beneish M-Score Chart
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Covance Annual Data
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Trend |
Dec04 |
Dec05 |
Dec06 |
Dec07 |
Dec08 |
Dec09 |
Dec10 |
Dec11 |
Dec12 |
Dec13 |
| Beneish M-Score |
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-2.45 |
-3.29 |
-2.54 |
-2.72 |
-3.02 |
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Covance Quarterly Data
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Dec09 |
Mar10 |
Jun10 |
Sep10 |
Dec10 |
Mar11 |
Jun11 |
Sep11 |
Dec11 |
Mar12 |
Jun12 |
Sep12 |
Dec12 |
Mar13 |
Jun13 |
Sep13 |
Dec13 |
Mar14 |
Jun14 |
Sep14 |
| Beneish M-Score |
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-2.33 |
-3.02 |
-2.96 |
-3.13 |
-3.02 |
Competitive Comparison of Covance's Beneish M-Score
For the Diagnostics & Research subindustry, Covance'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.
Covance's Beneish M-Score Distribution in the Medical Diagnostics & Research Industry
For the Medical Diagnostics & Research industry and Healthcare sector, Covance's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where Covance's Beneish M-Score falls into.
Covance 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 Covance 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 * 0.9779 | + | 0.528 * 0.7684 | + | 0.404 * 0.9754 | + | 0.892 * 1.0369 | + | 0.115 * 0.9609 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 1.501 | + | 4.679 * -0.060925 | - | 0.327 * 0.9061 |
| = | -2.94 |
* 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 (Sep14) TTM: | Last Year (Sep13) TTM: |
Total Receivables was €380 Mil.
Revenue was 520.694 + 505.711 + 481.726 + 488.931 = €1,997 Mil.
Gross Profit was 152.15 + 141.899 + 135.562 + 135.953 = €566 Mil.
Total Current Assets was €1,178 Mil.
Total Assets was €1,965 Mil.
Property, Plant and Equipment(Net PPE) was €669 Mil.
Depreciation, Depletion and Amortization(DDA) was €100 Mil.
Selling, General, & Admin. Expense(SGA) was €261 Mil.
Total Current Liabilities was €421 Mil.
Long-Term Debt & Capital Lease Obligation was €194 Mil.
Net Income was 51.215 + 12.466 + 36.74 + 33.468 = €134 Mil.
Non Operating Income was 9.188 + -1.135 + 0.901 + -0.01 = €9 Mil.
Cash Flow from Operations was 104.86 + 50.066 + -51.007 + 140.748 = €245 Mil.
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Total Receivables was €375 Mil.
Revenue was 483.993 + 488.134 + 489.707 + 464.168 = €1,926 Mil.
Gross Profit was 136.035 + 131.273 + 130.356 + 21.462 = €419 Mil.
Total Current Assets was €1,044 Mil.
Total Assets was €1,824 Mil.
Property, Plant and Equipment(Net PPE) was €667 Mil.
Depreciation, Depletion and Amortization(DDA) was €95 Mil.
Selling, General, & Admin. Expense(SGA) was €168 Mil.
Total Current Liabilities was €630 Mil.
Long-Term Debt & Capital Lease Obligation was €0 Mil.
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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) |
| = | (380.195 / 1997.062) | / | (374.969 / 1926.002) |
| = | 0.190377 | / | 0.194688 |
| | = | 0.9779 |
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) |
| = | (419.126 / 1926.002) | / | (565.564 / 1997.062) |
| = | 0.217615 | / | 0.283198 |
| | = | 0.7684 |
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 - (1177.598 + 669.046) / 1965.087) | / | (1 - (1044.184 + 666.977) / 1823.859) |
| = | 0.060274 | / | 0.061791 |
| | = | 0.9754 |
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 |
| = | 1997.062 | / | 1926.002 |
| | = | 1.0369 |
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)) |
| = | (95.364 / (95.364 + 666.977)) | / | (100.134 / (100.134 + 669.046)) |
| = | 0.125094 | / | 0.130183 |
| | = | 0.9609 |
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) |
| = | (261.15 / 1997.062) | / | (167.789 / 1926.002) |
| = | 0.130767 | / | 0.087118 |
| | = | 1.501 |
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) |
| = | ((194 + 421.491) / 1965.087) | / | ((0 + 630.441) / 1823.859) |
| = | 0.313213 | / | 0.345663 |
| | = | 0.9061 |
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 |
| = | (133.889 - 8.944 | - | 244.667) | / | 1965.087 |
| | = | -0.060925 |
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.
Covance has a M-score of -2.94 suggests that the company is unlikely to be a manipulator.
Covance (FRA:CVD) Business Description
Traded in Other Exchanges
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Covance, Inc is a Delaware Corporation, founded in 1987. The Company is a drug development services company providing early-stage and late-stage product development services mainly to the pharmaceutical, biotechnology and medical device industries. It also provides laboratory testing services to the chemical, agrochemical and food industries. Its two reportable segments are early development services, which include discovery support services, preclinical services and clinical pharmacology services; and late-stage development services, which include central laboratory, Phase II-IV clinical development, and market access services. The Company's preclinical services include toxicology services, pharmaceutical chemistry and related services. The Company's preclinical area has been a source of innovation by introducing new technologies for client access to data such as StudyTracker, electronic animal identification, multimedia study reports and animal and test tube measures of induced cell proliferation or reproduction. The Company's preclinical toxicology services include in vivo toxicology studies, which are studies of the effects of drugs in animals, genetic toxicology studies, which include studies of the effects of drugs on chromosomes, as well as on genetically modified mice and other specialized toxicology services. In its pharmaceutical chemistry services, it determines the metabolic profile and bioavailability of drug candidates. It also provides laboratory testing services to the chemical, agricultural chemical and food industries. The Company offers services to agricultural chemical manufacturers to determine the potential risk to humans, animals and the environment from plant protection products such as pesticides. In its nutritional chemistry services, the Company offers a range of services to the food, nutriceutical and animal feed industries, including nutritional analysis and equivalency, nutritional content fact labels, microbiological and chemical contaminant safety analysis, pesticide screening and stability testing. It provides custom polyclonal and monoclonal antibody services for research purposes and purpose-bred animals for biomedical research. The Company provides optimization and translational services including custom immunology and monoclonal antibody services, metabolism studies and pharmacokinetic screening as well as non-GLP toxicology, in vivo pharmacology, imaging services and biomarker services. The Company's bioanalytical testing services helps determine the appropriate dose and frequency of drug application from late discovery evaluation through Phase III clinical testing on a full-scale, globally integrated basis. The Company provides clinical pharmacology services, including first-in-human trials, of new pharmaceuticals at its seven clinics located throughout the United States and its one clinic in Leeds, United Kingdom. The Company offers reimbursement and healthcare economics consulting services
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