TIAIY (Telecom Italia SpA) Beneish M-Score : -3.02 (As of Dec. 12, 2024)

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What is Telecom Italia SpA 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 -3.02 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

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

TIAIY' s Beneish M-Score Range Over the Past 10 Years
Min: -3.5 Med: -2.83 Max: -2.35
Current: -3.02

During the past 13 years, the highest Beneish M-Score of Telecom Italia SpA was -2.35. The lowest was -3.50. And the median was -2.83.

Telecom Italia SpA Beneish M-Score Historical Data

The historical data trend for Telecom Italia SpA'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 Italia SpA Beneish M-Score Chart

Telecom Italia SpA Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.75

-2.42

-3.50

-3.02

-2.77

Telecom Italia SpA Quarterly Data
	Dec19	Mar20	Jun20	Sep20	Dec20	Mar21	Jun21	Sep21	Dec21	Mar22	Jun22	Sep22	Dec22	Mar23	Jun23	Sep23	Dec23	Mar24	Jun24	Sep24
Beneish M-Score	Get a 7-Day Free Trial															-3.23	-2.77	-3.06	-3.10	-3.02

Competitive Comparison of Telecom Italia SpA's Beneish M-Score

For the Telecom Services subindustry, Telecom Italia SpA'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 Italia SpA's Beneish M-Score Distribution in the Telecommunication Services Industry

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

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

Telecom Italia SpA 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 Italia SpA 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 * 0.9212

0.528 * 0.9687

0.404 * 1.0772

0.892 * 1.1056

0.115 * 0.4269

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.5995

4.679 * -0.119348

0.327 * 0.9027

-2.97

This Year (Sep24) TTM:

Last Year (Sep23) TTM:

Total Receivables was $5,046 Mil.
Revenue was 3961.154 + 3370.291 + 4271.739 + 6384.951 = $17,988 Mil.
Gross Profit was 1685.905 + 1490.85 + 2490.217 + 4368.593 = $10,036 Mil.
Total Current Assets was $10,070 Mil.
Total Assets was $42,023 Mil.
Property, Plant and Equipment(Net PPE) was $8,873 Mil.
Depreciation, Depletion and Amortization(DDA) was $5,245 Mil.
Selling, General, & Admin. Expense(SGA) was $-773 Mil.
Total Current Liabilities was $11,915 Mil.
Long-Term Debt & Capital Lease Obligation was $13,241 Mil.
Net Income was 152.053 + -264.801 + -434.783 + -345.692 = $-893 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = $0 Mil.
Cash Flow from Operations was 465.039 + 1595.264 + 418.478 + 1643.402 = $4,122 Mil.

Total Receivables was $4,954 Mil.
Revenue was 4383.138 + 3256.771 + 4118.844 + 4511.653 = $16,270 Mil.
Gross Profit was 2551.761 + 1318.527 + 2432.548 + 2490.466 = $8,793 Mil.
Total Current Assets was $11,179 Mil.
Total Assets was $65,707 Mil.
Property, Plant and Equipment(Net PPE) was $21,028 Mil.
Depreciation, Depletion and Amortization(DDA) was $3,963 Mil.
Selling, General, & Admin. Expense(SGA) was $-1,166 Mil.
Total Current Liabilities was $15,861 Mil.
Long-Term Debt & Capital Lease Obligation was $27,713 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)
	=	(5045.505 / 17988.135)	/	(4954.109 / 16270.406)
	=	0.280491	/	0.304486
	=	0.9212

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)
	=	(8793.302 / 16270.406)	/	(10035.565 / 17988.135)
	=	0.540448	/	0.557899
	=	0.9687

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 - (10069.922 + 8873.474) / 42023.307)	/	(1 - (11179.296 + 21027.748) / 65706.51)
	=	0.549217	/	0.509835
	=	1.0772

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
	=	17988.135	/	16270.406
	=	1.1056

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))
	=	(3963.175 / (3963.175 + 21027.748))	/	(5244.771 / (5244.771 + 8873.474))
	=	0.158585	/	0.371489
	=	0.4269

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)
	=	(-772.826 / 17988.135)	/	(-1165.953 / 16270.406)
	=	-0.042963	/	-0.071661
	=	0.5995

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)
	=	((13240.844 + 11914.539) / 42023.307)	/	((27712.914 + 15861.259) / 65706.51)
	=	0.598606	/	0.663164
	=	0.9027

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
	=	(-893.223 - 0	-	4122.183)	/	42023.307
	=	-0.119348

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 Italia SpA has a M-score of -2.97 suggests that the company is unlikely to be a manipulator.

Telecom Italia SpA Beneish M-Score Related Terms

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Telecom Italia SpA Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Telecommunication Services » Telecom Italia SpA (OTCPK:TIAIY) » Definitions » Beneish M-Score

Comparable Companies

Traded in Other Exchanges

TIAOF:USA TIIAY:USA TITR:Italy TIT:Italy TITm:UK 0H6I:UK 0GA3:UK TQIR:Germany TITR:Austria TIT:Austria

Address

Corso D\'Italia, 41, Roma, ITA, 00198

Website

https://www.telecomitalia.com

Telecom Italia is the incumbent telecommunications operator in Italy with more than 30% share in the Italian mobile market and 40% share in broadband. In the mobile market, it competes with Vodafone, Wind Tre, and Iliad. After the sale of its fixed network to KKR for EUR 18.8 billion, TIM will become a pure service provider. TIM also has a 20% wireless market share in Brazil and has started building a broadband network in the country, although its reach is very small compared with competitors Telefonica and America Movil.