Stock Analysis on Net
Stock Analysis on Net
Microsoft Excel LibreOffice Calc

Amgen Inc. (NASDAQ:AMGN)

Financial Reporting Quality: Aggregate Accruals

Advanced level

Balance-Sheet-Based Accruals Ratio

Amgen Inc., balance sheet computation of aggregate accruals

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Operating Assets
Total assets 59,707  66,416  79,954  77,626  71,576 
Less: Cash and cash equivalents 6,037  6,945  3,800  3,241  4,144 
Less: Marketable securities 2,874  22,359  37,878  34,844  27,238 
Operating assets 50,796  37,112  38,276  39,541  40,194 
Operating Liabilities
Total liabilities 50,034  53,916  54,713  47,751  43,493 
Less: Current portion of long-term debt 2,953  4,419  1,152  4,403  2,250 
Less: Long-term debt, excluding current portion 26,950  29,510  34,190  30,193  29,306 
Operating liabilities 20,131  19,987  19,371  13,155  11,937 
 
Net operating assets1 30,665  17,125  18,905  26,386  28,257 
Balance-sheet-based aggregate accruals2 13,540  (1,780) (7,481) (1,871) — 
Financial Ratio
Balance-sheet-based accruals ratio3 56.66% -9.88% -33.04% -6.85%
Benchmarks
Balance-Sheet-Based Accruals Ratio, Competitors4
Abbott Laboratories -1.97% -6.71% 69.42% -1.06%
AbbVie Inc. -24.37% -31.42% -7.02% 25.20%
Bristol-Myers Squibb Co. 147.33% -3.17% -24.97% -0.82%
Eli Lilly & Co. -0.10% -10.27% -5.99% 1.26%
Gilead Sciences Inc. 19.80% -41.29% -16.94% 23.56%
Illumina Inc. -2.16% 10.15% 6.34% 23.87%
Johnson & Johnson -3.85% -8.03% 31.51% 5.55%
Merck & Co. Inc. -2.90% -15.70% -0.65% -12.97%
Pfizer Inc. 19.85% -9.34% 12.36% 4.12%
Regeneron Pharmaceuticals Inc. 25.36% 20.14% 33.15% 26.37%
Vertex Pharmaceuticals Inc. 42.22% 110.08% -29.69% -17.29%
Zoetis Inc. 4.03% 29.08% -1.25% 8.66%
Balance-Sheet-Based Accruals Ratio, Sector
Pharmaceuticals & Biotechnology 24.94% -11.49% 10.25% 3.98%
Balance-Sheet-Based Accruals Ratio, Industry
Health Care 16.24% -0.89% 9.08% 4.58%

Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-16).

1 2019 Calculation
Net operating assets = Operating assets – Operating liabilities
= 50,79620,131 = 30,665

2 2019 Calculation
Balance-sheet-based aggregate accruals = Net operating assets2019 – Net operating assets2018
= 30,66517,125 = 13,540

3 2019 Calculation
Balance-sheet-based accruals ratio = 100 × Balance-sheet-based aggregate accruals ÷ Avg. net operating assets
= 100 × 13,540 ÷ [(30,665 + 17,125) ÷ 2] = 56.66%

4 Click competitor name to see calculations.

Financial ratio Description The company
Balance-sheet-based accruals ratio Ratio is found by dividing balance-sheet-based aggregate accruals by average net operating assets. Using the balance-sheet-based accruals ratio, Amgen Inc. deteriorated earnings quality from 2018 to 2019.

Cash-Flow-Statement-Based Accruals Ratio

Amgen Inc., cash flow statement computation of aggregate accruals

US$ in millions

Microsoft Excel LibreOffice Calc
Dec 31, 2019 Dec 31, 2018 Dec 31, 2017 Dec 31, 2016 Dec 31, 2015
Net income 7,842  8,394  1,979  7,722  6,939 
Less: Net cash provided by operating activities 9,150  11,296  11,177  10,354  9,077 
Less: Net cash (used in) provided by investing activities 5,709  14,339  (4,024) (8,658) (5,547)
Cash-flow-statement-based aggregate accruals (7,017) (17,241) (5,174) 6,026  3,409 
Financial Ratio
Cash-flow-statement-based accruals ratio1 -29.37% -95.70% -22.85% 22.06%
Benchmarks
Cash-Flow-Statement-Based Accruals Ratio, Competitors2
Abbott Laboratories -1.39% -5.39% 12.34% -6.46%
AbbVie Inc. -28.46% -23.85% -12.92% 16.02%
Bristol-Myers Squibb Co. 10.75% -1.14% -28.29% 0.76%
Eli Lilly & Co. 74.20% -25.54% -11.43% 5.63%
Gilead Sciences Inc. 19.49% -73.15% 28.23% 29.15%
Illumina Inc. -33.57% 65.79% 3.10% 16.01%
Johnson & Johnson -3.04% -5.08% -7.40% 4.68%
Merck & Co. Inc. -2.28% -19.26% -13.29% -5.97%
Pfizer Inc. 7.93% -10.12% 10.69% -1.06%
Regeneron Pharmaceuticals Inc. 22.48% 28.32% 19.22% 13.64%
Vertex Pharmaceuticals Inc. 35.87% 86.04% -22.78% -57.04%
Zoetis Inc. 2.95% 31.33% -4.07% 6.41%
Cash-Flow-Statement-Based Accruals Ratio, Sector
Pharmaceuticals & Biotechnology 3.38% -17.13% -1.04% 5.28%
Cash-Flow-Statement-Based Accruals Ratio, Industry
Health Care 4.20% -6.12% 0.90% 5.83%

Based on: 10-K (filing date: 2020-02-12), 10-K (filing date: 2019-02-13), 10-K (filing date: 2018-02-13), 10-K (filing date: 2017-02-14), 10-K (filing date: 2016-02-16).

1 2019 Calculation
Cash-flow-statement-based accruals ratio = 100 × Cash-flow-statement-based aggregate accruals ÷ Avg. net operating assets
= 100 × -7,017 ÷ [(30,665 + 17,125) ÷ 2] = -29.37%

2 Click competitor name to see calculations.

Financial ratio Description The company
Cash-flow-statement-based accruals ratio Ratio is found by dividing cash-flow-statement-based aggregate accruals by average net operating assets. Using the cash-flow-statement-based accruals ratio, Amgen Inc. improved earnings quality from 2018 to 2019.