tw telecom Beneish M-Score Historical Data
The historical data trend for tw telecom'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.
tw telecom Beneish M-Score Chart
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tw telecom Annual Data
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Trend |
Dec04 |
Dec05 |
Dec06 |
Dec07 |
Dec08 |
Dec09 |
Dec10 |
Dec11 |
Dec12 |
Dec13 |
| Beneish M-Score |
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-3.27 |
-2.47 |
-2.96 |
-3.11 |
-3.02 |
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tw telecom Quarterly Data
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Sep09 |
Dec09 |
Mar10 |
Jun10 |
Sep10 |
Dec10 |
Mar11 |
Jun11 |
Sep11 |
Dec11 |
Mar12 |
Jun12 |
Sep12 |
Dec12 |
Mar13 |
Jun13 |
Sep13 |
Dec13 |
Mar14 |
Jun14 |
| Beneish M-Score |
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-3.12 |
-3.29 |
-3.02 |
-3.22 |
-3.20 |
Competitive Comparison of tw telecom's Beneish M-Score
For the Telecom Services subindustry, tw telecom'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.
tw telecom's Beneish M-Score Distribution in the Telecommunication Services Industry
For the Telecommunication Services industry and Communication Services sector, tw telecom's Beneish M-Score distribution charts can be found below:
* The bar in red indicates where tw telecom's Beneish M-Score falls into.
tw telecom 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 tw telecom 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 * 0.9197 | + | 0.528 * 1.0042 | + | 0.404 * 1.0401 | + | 0.892 * 1.0227 | + | 0.115 * 1.0271 |
| - | 0.172 * SGAI | + | 4.679 * TATA | - | 0.327 * LVGI |
| - | 0.172 * 1.0838 | + | 4.679 * -0.137315 | - | 0.327 * 1.174 |
| = | -3.23 |
* 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 (Jun14) TTM: | Last Year (Jun13) TTM: |
Total Receivables was €78 Mil.
Revenue was 308.901 + 295.196 + 292.014 + 294.106 = €1,190 Mil.
Gross Profit was 175.398 + 169.366 + 168.926 + 171.244 = €685 Mil.
Total Current Assets was €405 Mil.
Total Assets was €2,081 Mil.
Property, Plant and Equipment(Net PPE) was €1,276 Mil.
Depreciation, Depletion and Amortization(DDA) was €239 Mil.
Selling, General, & Admin. Expense(SGA) was €307 Mil.
Total Current Liabilities was €217 Mil.
Long-Term Debt & Capital Lease Obligation was €1,409 Mil.
Net Income was 8.206 + 7.079 + 11.243 + -7.057 = €19 Mil.
Non Operating Income was 0 + -0.927 + 0 + -29.108 = €-30 Mil.
Cash Flow from Operations was 80.43 + 83.308 + 78.836 + 92.682 = €335 Mil.
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Total Receivables was €83 Mil.
Revenue was 295.228 + 294.293 + 287.954 + 286.293 = €1,164 Mil.
Gross Profit was 170.817 + 169.938 + 166.66 + 165.085 = €673 Mil.
Total Current Assets was €629 Mil.
Total Assets was €2,210 Mil.
Property, Plant and Equipment(Net PPE) was €1,173 Mil.
Depreciation, Depletion and Amortization(DDA) was €227 Mil.
Selling, General, & Admin. Expense(SGA) was €277 Mil.
Total Current Liabilities was €378 Mil.
Long-Term Debt & Capital Lease Obligation was €1,093 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) |
| = | (78.263 / 1190.217) | / | (83.202 / 1163.768) |
| = | 0.065755 | / | 0.071494 |
| | = | 0.9197 |
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) |
| = | (672.5 / 1163.768) | / | (684.934 / 1190.217) |
| = | 0.577864 | / | 0.57547 |
| | = | 1.0042 |
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 - (404.677 + 1276.325) / 2080.984) | / | (1 - (628.505 + 1172.849) / 2209.711) |
| = | 0.192208 | / | 0.184801 |
| | = | 1.0401 |
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 |
| = | 1190.217 | / | 1163.768 |
| | = | 1.0227 |
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)) |
| = | (226.584 / (226.584 + 1172.849)) | / | (238.856 / (238.856 + 1276.325)) |
| = | 0.161911 | / | 0.157642 |
| | = | 1.0271 |
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) |
| = | (306.598 / 1190.217) | / | (276.611 / 1163.768) |
| = | 0.257598 | / | 0.237686 |
| | = | 1.0838 |
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) |
| = | ((1409.35 + 217.088) / 2080.984) | / | ((1092.887 + 378.205) / 2209.711) |
| = | 0.781572 | / | 0.66574 |
| | = | 1.174 |
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 |
| = | (19.471 - -30.035 | - | 335.256) | / | 2080.984 |
| | = | -0.137315 |
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.
tw telecom has a M-score of -3.23 suggests that the company is unlikely to be a manipulator.
tw telecom (FRA:TWM) Business Description
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Tw telecom inc was formed in 1998. The Company together with its wholly-owned subsidiaries provide managed network services, specializing in business Ethernet, data networking, Converged, IP-based virtual private network or "IP VPN", Internet access, voice, including voice over Internet Protocol or "VoIP", and network security services to enterprise organizations, including public sector entities, and carriers throughout the U.S., including global locations. It offers a portfolio of solutions to its customers with predictable and reliable service quality. It designs and deliver scalable and efficient solutions that enable its customers complex and evolving business applications. These solutions emphasize its data networking service offerings, which include an expanding portfolio of business Ethernet data services, managed network services and its converged service offerings comprised of data, Internet, voice, security, remote access and managed routers. It also provides a broad range of traditional services, including a dedicated network service portfolio with private line, special access and private transport services, voice services and secure Internet access. Its customers include enterprise organizations in a wide variety of industry segments, including, among others, the financial services, technology and science, health care, distribution, manufacturing and professional services industries, data centers, cloud application providers, public sector entities, system integrators and communications service providers, including ILECs, CLECs, wireless communications companies and cable companies. Its primary competition is from the ILECs, CLECs and cable companies. The ILECs, primarily AT&T Inc., Verizon Communications, Inc. and CenturyLink Inc., other CLECs and some cable companies offer services substantially similar to some of those it offers and target some of the same customers. The Company is subject to regulation by the Federal Communications Commission ("FCC"), state regulatory authorities and local government agencies.
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