Saudi Telecom Co (SAU:7010) Beneish M-Score : -2.55 (As of Apr. 25, 2024)

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What is Saudi Telecom Co 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 -2.55 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

SAU:7010' s Beneish M-Score Range Over the Past 10 Years
Min: -3.07 Med: -2.64 Max: -2.04
Current: -2.55

During the past 13 years, the highest Beneish M-Score of Saudi Telecom Co was -2.04. The lowest was -3.07. And the median was -2.64.

Saudi Telecom Co Beneish M-Score Historical Data

The historical data trend for Saudi Telecom Co'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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Saudi Telecom Co Beneish M-Score Chart

Saudi Telecom Co Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.04

-3.06

-2.22

-3.07

-2.55

Saudi Telecom Co 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															-3.07	-2.97	-2.90	-2.73	-2.55

Competitive Comparison of Saudi Telecom Co's Beneish M-Score

For the Telecom Services subindustry, Saudi Telecom Co'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.

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

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

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

Saudi Telecom Co 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 Saudi Telecom Co 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 * 1.0767

0.528 * 1.0611

0.404 * 1.1741

0.892 * 1.0727

0.115 * 0.9965

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.9895

4.679 * -0.057127

0.327 * 1.1394

-2.55

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was ﷼43,651 Mil.
Revenue was 17724.308 + 18106.004 + 18326.978 + 18179.321 = ﷼72,337 Mil.
Gross Profit was 8928.257 + 10387.616 + 9133.312 + 9354.505 = ﷼37,804 Mil.
Total Current Assets was ﷼71,224 Mil.
Total Assets was ﷼159,683 Mil.
Property, Plant and Equipment(Net PPE) was ﷼51,904 Mil.
Depreciation, Depletion and Amortization(DDA) was ﷼10,483 Mil.
Selling, General, & Admin. Expense(SGA) was ﷼4,011 Mil.
Total Current Liabilities was ﷼48,071 Mil.
Long-Term Debt & Capital Lease Obligation was ﷼16,893 Mil.
Net Income was 2274.244 + 4904.02 + 3008.446 + 3108.671 = ﷼13,295 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = ﷼0 Mil.
Cash Flow from Operations was 12430.538 + 4872.015 + 1828.637 + 3286.368 = ﷼22,418 Mil.

Total Receivables was ﷼37,792 Mil.
Revenue was 17374.482 + 16307.74 + 16829.958 + 16919.366 = ﷼67,432 Mil.
Gross Profit was 9028.663 + 10040.109 + 9174.082 + 9150.401 = ﷼37,393 Mil.
Total Current Assets was ﷼60,790 Mil.
Total Assets was ﷼137,220 Mil.
Property, Plant and Equipment(Net PPE) was ﷼49,675 Mil.
Depreciation, Depletion and Amortization(DDA) was ﷼9,990 Mil.
Selling, General, & Admin. Expense(SGA) was ﷼3,779 Mil.
Total Current Liabilities was ﷼36,400 Mil.
Long-Term Debt & Capital Lease Obligation was ﷼12,597 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)
	=	(43650.556 / 72336.611)	/	(37792.34 / 67431.546)
	=	0.603437	/	0.560455
	=	1.0767

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)
	=	(37393.255 / 67431.546)	/	(37803.69 / 72336.611)
	=	0.554537	/	0.522608
	=	1.0611

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 - (71224.125 + 51903.623) / 159682.77)	/	(1 - (60790.447 + 49675.09) / 137219.986)
	=	0.228923	/	0.194975
	=	1.1741

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
	=	72336.611	/	67431.546
	=	1.0727

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))
	=	(9990.226 / (9990.226 + 49675.09))	/	(10482.577 / (10482.577 + 51903.623))
	=	0.167438	/	0.168027
	=	0.9965

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)
	=	(4011.366 / 72336.611)	/	(3778.968 / 67431.546)
	=	0.055454	/	0.056042
	=	0.9895

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)
	=	((16893.306 + 48070.79) / 159682.77)	/	((12596.956 + 36400.164) / 137219.986)
	=	0.406832	/	0.35707
	=	1.1394

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
	=	(13295.381 - 0	-	22417.558)	/	159682.77
	=	-0.057127

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.

Saudi Telecom Co has a M-score of -2.55 suggests that the company is unlikely to be a manipulator.

Saudi Telecom Co Beneish M-Score Related Terms

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Saudi Telecom Co (SAU:7010) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Telecommunication Services » Saudi Telecom Co (SAU:7010) » Definitions » Beneish M-Score

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Traded in Other Exchanges

N/A

Address

P.O.Box 87912, Riyadh, SAU, 11652

Website

https://www.stc.com.sa

Saudi Telecom Co offers telecommunications, information and media services that establish, manage, operates and maintains fixed and mobile telecommunication networks and systems to customers. The company manufactures and markets devices, equipment, and components of different telecommunication networks including fixed, moving and special networks, and computer programs and the other intellectual properties. It is also engaged in real estate investment and the resulting activities, such as selling, buying, leasing, managing, developing and maintenance. The majority of the revenue is generated from Saudi Arabia.

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