Telecom Argentina (FRA:TEO) Beneish M-Score : -2.80 (As of May. 09, 2024)

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What is Telecom Argentina Beneish M-Score?

The zones of discrimination for M-Score is as such:

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.

Good Sign:

Beneish M-Score -2.8 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Telecom Argentina's Beneish M-Score or its related term are showing as below:

FRA:TEO' s Beneish M-Score Range Over the Past 10 Years
Min: -3.76 Med: -2.91 Max: 1.67
Current: -2.8

During the past 13 years, the highest Beneish M-Score of Telecom Argentina was 1.67. The lowest was -3.76. And the median was -2.91.

Telecom Argentina Beneish M-Score Historical Data

The historical data trend for Telecom Argentina'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.

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Telecom Argentina Beneish M-Score Chart

Telecom Argentina Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-3.48

-3.09

-3.42

-0.47

-2.80

Telecom Argentina Quarterly Data
	Mar19	Jun19	Sep19	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23
Beneish M-Score	Get a 7-Day Free Trial															-0.47	-2.32	-1.52	-1.03	-2.80

Competitive Comparison of Telecom Argentina's Beneish M-Score

For the Telecom Services subindustry, Telecom Argentina'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.

Telecom Argentina's Beneish M-Score Distribution in the Telecommunication Services Industry

For the Telecommunication Services industry and Communication Services sector, Telecom Argentina's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Telecom Argentina's Beneish M-Score falls into.

Telecom Argentina 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 Telecom Argentina for today is based on a combination of the following eight different indices:

-4.84

0.92 * DSRI

0.528 * GMI

0.404 * AQI

0.892 * SGI

0.115 * DEPI

-4.84

0.92 * 1.1016

0.528 * 1.004

0.404 * 1.037

0.892 * 0.4153

0.115 * 0.8234

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0114

4.679 * -0.062458

0.327 * 1.3431

-3.32

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was €406 Mil.
Revenue was 2612.129 + 892.695 + 966.65 + 1015.642 = €5,487 Mil.
Gross Profit was 1914.953 + 657.804 + 696.627 + 760.916 = €4,030 Mil.
Total Current Assets was €1,251 Mil.
Total Assets was €13,914 Mil.
Property, Plant and Equipment(Net PPE) was €6,319 Mil.
Depreciation, Depletion and Amortization(DDA) was €1,875 Mil.
Selling, General, & Admin. Expense(SGA) was €1,781 Mil.
Total Current Liabilities was €2,811 Mil.
Long-Term Debt & Capital Lease Obligation was €4,137 Mil.
Net Income was -861.203 + 81.121 + 13.357 + 131.242 = €-635 Mil.
Non Operating Income was -1530.846 + -49.673 + -12.449 + 11.929 = €-1,581 Mil.
Cash Flow from Operations was 793.106 + 458.754 + 311.497 + 251.246 = €1,815 Mil.

Total Receivables was €887 Mil.
Revenue was 6467.022 + 2567.53 + 2150.698 + 2027.777 = €13,213 Mil.
Gross Profit was 4756.55 + 1884.546 + 1587.131 + 1515.934 = €9,744 Mil.
Total Current Assets was €1,981 Mil.
Total Assets was €30,317 Mil.
Property, Plant and Equipment(Net PPE) was €15,005 Mil.
Depreciation, Depletion and Amortization(DDA) was €3,483 Mil.
Selling, General, & Admin. Expense(SGA) was €4,241 Mil.
Total Current Liabilities was €5,055 Mil.
Long-Term Debt & Capital Lease Obligation was €6,216 Mil.

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)
	=	(405.736 / 5487.116)	/	(886.865 / 13213.027)
	=	0.073943	/	0.067121
	=	1.1016

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)
	=	(9744.161 / 13213.027)	/	(4030.3 / 5487.116)
	=	0.737466	/	0.734502
	=	1.004

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 - (1250.78 + 6318.74) / 13914.022)	/	(1 - (1981.071 + 15004.871) / 30316.968)
	=	0.455979	/	0.439722
	=	1.037

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
	=	5487.116	/	13213.027
	=	0.4153

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))
	=	(3482.994 / (3482.994 + 15004.871))	/	(1874.625 / (1874.625 + 6318.74))
	=	0.188394	/	0.228798
	=	0.8234

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)
	=	(1781.395 / 5487.116)	/	(4241.091 / 13213.027)
	=	0.324651	/	0.320978
	=	1.0114

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)
	=	((4136.999 + 2811.248) / 13914.022)	/	((6216.442 + 5055.437) / 30316.968)
	=	0.49937	/	0.371801
	=	1.3431

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
	=	(-635.483 - -1581.039	-	1814.603)	/	13914.022
	=	-0.062458

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.

Telecom Argentina has a M-score of -3.32 suggests that the company is unlikely to be a manipulator.

Telecom Argentina Beneish M-Score Related Terms

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Telecom Argentina (FRA:TEO) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Telecommunication Services » Telecom Argentina SA (FRA:TEO) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

TCMFF:USA TEO:USA TEO:Mexico TEO:Germany TECO2:Argentina

Address

General Hornos 690, Buenos Aires, ARG, C1272ACK

Website

https://institucional.telecom.com.ar

Telecom Argentina SA offers its customers quadruple play services, combining mobile telephony services, cable television services, Internet services and fixed telephony services. It also provides other telephone-related services such as international long-distance and wholesale services, data transmission and IT solutions outsourcing and install, operate and develop cable television and data transmission services. The company provides services in Argentina (mobile, cable television, Internet and fixed and data services), Paraguay (mobile, Internet and satellite TV services), Uruguay (cable television services) and the United States (fixed wholesale services).