| IMO Stock | | | CAD 103.69 0.17 0.16% |
This module uses fundamental data of Imperial Oil to approximate the value of its Beneish M Score. Imperial Oil M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out
Risk vs Return Analysis to better understand how to build diversified portfolios, which includes a position in Imperial Oil. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as
signals in board of governors.
To learn how to invest in Imperial Stock, please use our
How to Invest in Imperial Oil guide.
At this time, Imperial Oil's
Long Term Debt To Capitalization is very stable compared to the past year. As of the 30th of November 2024,
Total Debt To Capitalization is likely to grow to 0.22, while
Short and Long Term Debt Total is likely to drop about 3.1
B. At this time, Imperial Oil's
EV To Sales is very stable compared to the past year. As of the 30th of November 2024,
Free Cash Flow Per Share is likely to grow to 3.56, while
Dividend Yield is likely to drop 0.02.
At this time, Imperial Oil's M Score is inapplicable. The earnings manipulation may begin if Imperial Oil's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Imperial Oil executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Imperial Oil's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
-2.33
Beneish M Score - Inapplicable
| Elasticity of Receivables | |
| Financial Leverage Condition | |
Imperial Oil Beneish M-Score Indicator Trends
The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Imperial Oil's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
Imperial Oil Beneish M-Score Driver Matrix
One of the toughest challenges investors face today is learning how to quickly synthesize historical
financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Imperial Oil's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Imperial Oil in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Imperial Oil's degree of accounting gimmicks and manipulations.
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About Imperial Oil Beneish M Score
M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled
The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed
financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.
Imperial Oil Earnings Manipulation Drivers
Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Imperial Oil. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
Imperial Oil ESG Sustainability
Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Imperial Oil's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Imperial Oil's managers, analysts, and investors.
About Imperial Oil Fundamental Analysis
The Macroaxis Fundamental Analysis modules help investors analyze Imperial Oil's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Imperial Oil using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at
the intrinsic value of Imperial Oil based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing
financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
Please read more on our
fundamental analysis page.
Pair Trading with Imperial Oil
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Imperial Oil position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Imperial Oil will appreciate offsetting losses from the drop in the long position's value.
The ability to find closely correlated positions to Imperial Oil could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Imperial Oil when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Imperial Oil - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Imperial Oil to buy it.
The correlation of Imperial Oil is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Imperial Oil moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Imperial Oil moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Imperial Oil can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
When determining whether Imperial Oil offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Imperial Oil's
financial statements, including income statements, balance sheets, and cash flow statements, to assess its
financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Imperial Oil Stock.
Outlined below are crucial reports that will aid in making a well-informed decision on Imperial Oil Stock: Check out
Risk vs Return Analysis to better understand how to build diversified portfolios, which includes a position in Imperial Oil. Also, note that the market value of any company could be closely tied with the direction of predictive economic indicators such as
signals in board of governors.
To learn how to invest in Imperial Stock, please use our
How to Invest in Imperial Oil guide.
You can also try the
Content Syndication module to quickly integrate customizable finance content to your own investment portal.
Please note, there is a significant difference between Imperial Oil's value and its price as these two are different measures arrived at by different means. Investors typically determine if Imperial Oil is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Imperial Oil's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.