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British American Tobacco Beneish M-Score

: -2.71 (As of Today)
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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 -2.71 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

NYSE:BTI' s Beneish M-Score Range Over the Past 10 Years
Min: -2.71   Med: -2.42   Max: -1.15
Current: -2.71

-2.71
-1.15

During the past 13 years, the highest Beneish M-Score of British American Tobacco was -1.15. The lowest was -2.71. And the median was -2.42.


British American Tobacco Beneish M-Score Historical Data

The historical data trend for British American Tobacco'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.

* Premium members only.

British American Tobacco Annual Data
Trend Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18 Dec19 Dec20
Beneish M-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only -2.25 -1.15 -2.64 -2.49 -2.71

British American Tobacco Semi-Annual Data
Dec11 Jun12 Dec12 Jun13 Dec13 Jun14 Dec14 Jun15 Dec15 Jun16 Dec16 Jun17 Dec17 Jun18 Dec18 Jun19 Dec19 Jun20 Dec20 Jun21
Beneish M-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only - -2.49 - -2.71 -

Competitive Comparison

For the Tobacco subindustry, British American Tobacco'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.

   

British American Tobacco Beneish M-Score Distribution

For the Tobacco Products industry and Consumer Defensive sector, British American Tobacco's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where British American Tobacco's Beneish M-Score falls into.



British American Tobacco 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 British American Tobacco 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 * 0.9127+0.528 * 0.987+0.404 * 0.9973+0.892 * 1.0215+0.115 * 0.9656
-0.172 * SGAI+4.679 * TATA-0.327 * LVGI
-0.172 * 1.123+4.679 * -0.0246-0.327 * 1.002
=-2.69

* 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 (Dec20) TTM:Last Year (Dec19) TTM:
Accounts Receivable was $5,001 Mil.
Revenue was $34,645 Mil.
Gross Profit was $29,083 Mil.
Total Current Assets was $18,296 Mil.
Total Assets was $185,067 Mil.
Property, Plant and Equipment(Net PPE) was $6,801 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,949 Mil.
Selling, General, & Admin. Expense(SGA) was $38 Mil.
Total Current Liabilities was $20,804 Mil.
Long-Term Debt & Capital Lease Obligation was $53,665 Mil.
Net Income was $8,602 Mil.
Gross Profit was $0 Mil.
Cash Flow from Operations was $13,153 Mil.
Accounts Receivable was $5,364 Mil.
Revenue was $33,915 Mil.
Gross Profit was $28,100 Mil.
Total Current Assets was $17,397 Mil.
Total Assets was $184,803 Mil.
Property, Plant and Equipment(Net PPE) was $7,232 Mil.
Depreciation, Depletion and Amortization(DDA) was $1,982 Mil.
Selling, General, & Admin. Expense(SGA) was $33 Mil.
Total Current Liabilities was $24,670 Mil.
Long-Term Debt & Capital Lease Obligation was $49,547 Mil.




1. DSRI = Days Sales in Receivables Index

Measured as the ratio of Revenue in Accounts Receivable 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)
=(5001.3440860215 / 34645.161290323) / (5364.3512450852 / 33914.809960682)
=0.14435909 / 0.15817135
=0.9127

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)
=(28099.606815203 / 33914.809960682) / (29083.333333333 / 34645.161290323)
=0.82853499 / 0.83946307
=0.987

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 - (18295.698924731 + 6801.0752688172) / 185067.20430108) / (1 - (17397.116644823 + 7231.9790301442) / 184803.40760157)
=0.86439102 / 0.86672813
=0.9973

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
=34645.161290323 / 33914.809960682
=1.0215

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))
=(1981.6513761468 / (1981.6513761468 + 7231.9790301442)) / (1948.9247311828 / (1948.9247311828 + 6801.0752688172))
=0.21507824 / 0.22273425
=0.9656

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)
=(38.037634408602 / 34645.161290323) / (33.158584534731 / 33914.809960682)
=0.00109792 / 0.0009777
=1.123

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)
=((53665.322580645 + 20803.76344086) / 185067.20430108) / ((49546.526867628 + 24669.724770642) / 184803.40760157)
=0.40238943 / 0.40159569
=1.002

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
=(8602.1505376344 - 0 - 13153.225806452) / 185067.20430108
=-0.0246

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.

British American Tobacco has a M-score of -2.69 suggests that the company is unlikely to be a manipulator.


British American Tobacco Beneish M-Score Related Terms

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British American Tobacco Business Description

British American Tobacco logo
Industry
Address
Globe House, 4 Temple Place, London, GBR, WC2R 2PG
Following the acquisition of Reynolds American, British American Tobacco is neck-and-neck with Philip Morris International to be the largest listed global tobacco company--slightly larger than PMI on net revenue, but slightly smaller on volumes. British American's Global Drive Brands are Dunhill, Kent, Pall Mall, Lucky Strike, and Rothmans, and it also owns Newport and Camel in the U.S. The firm also sells vapor e-cigarettes, including its Vype brand, heated tobacco, with Glo, as well as roll- your-own and smokeless tobacco products. The company holds 31% of ITC Limited, the leading Indian cigarette-maker.

British American Tobacco Headlines

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