TELUS International (Cda) (TSX:TIXT) Beneish M-Score : -2.66 (As of Apr. 25, 2024)

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What is TELUS International (Cda) 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 -2.66 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for TELUS International (Cda)'s Beneish M-Score or its related term are showing as below:

TSX:TIXT' s Beneish M-Score Range Over the Past 10 Years
Min: -2.66 Med: -2.59 Max: -2.4
Current: -2.66

During the past 7 years, the highest Beneish M-Score of TELUS International (Cda) was -2.40. The lowest was -2.66. And the median was -2.59.

TELUS International (Cda) Beneish M-Score Historical Data

The historical data trend for TELUS International (Cda)'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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TELUS International (Cda) Beneish M-Score Chart

TELUS International (Cda) Annual Data

Trend

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-2.40

-2.59

-2.66

TELUS International (Cda) Quarterly Data
	Dec17	Dec18	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															-2.59	-2.35	-2.50	-2.42	-2.66

Competitive Comparison of TELUS International (Cda)'s Beneish M-Score

For the Software - Infrastructure subindustry, TELUS International (Cda)'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.

TELUS International (Cda)'s Beneish M-Score Distribution in the Software Industry

For the Software industry and Technology sector, TELUS International (Cda)'s Beneish M-Score distribution charts can be found below:

* The bar in red indicates where TELUS International (Cda)'s Beneish M-Score falls into.

TELUS International (Cda) 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 TELUS International (Cda) 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 * 0.9579

0.528 * 0.9765

0.404 * 1.0891

0.892 * 1.1289

0.115 * 0.9229

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 1.0835

4.679 * -0.042307

0.327 * 1.1716

-2.66

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was C$758 Mil.
Revenue was 928.387 + 897.105 + 886.176 + 938.654 = C$3,650 Mil.
Gross Profit was 764.712 + 740.146 + 726.744 + 797.719 = C$3,029 Mil.
Total Current Assets was C$997 Mil.
Total Assets was C$6,471 Mil.
Property, Plant and Equipment(Net PPE) was C$694 Mil.
Depreciation, Depletion and Amortization(DDA) was C$437 Mil.
Selling, General, & Admin. Expense(SGA) was C$2,272 Mil.
Total Current Liabilities was C$871 Mil.
Long-Term Debt & Capital Lease Obligation was C$2,184 Mil.
Net Income was 50.981 + 12.178 + -9.3 + 19.156 = C$73 Mil.
Non Operating Income was -14.758 + -12.178 + -23.915 + -23.261 = C$-74 Mil.
Cash Flow from Operations was 190.507 + 0 + 120.903 + 109.464 = C$421 Mil.

Total Receivables was C$701 Mil.
Revenue was 855.855 + 820.349 + 798.97 + 758.334 = C$3,234 Mil.
Gross Profit was 687.401 + 672.286 + 647.882 + 612.744 = C$2,620 Mil.
Total Current Assets was C$944 Mil.
Total Assets was C$4,831 Mil.
Property, Plant and Equipment(Net PPE) was C$610 Mil.
Depreciation, Depletion and Amortization(DDA) was C$338 Mil.
Selling, General, & Admin. Expense(SGA) was C$1,857 Mil.
Total Current Liabilities was C$750 Mil.
Long-Term Debt & Capital Lease Obligation was C$1,197 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)
	=	(758.004 / 3650.322)	/	(700.986 / 3233.508)
	=	0.207654	/	0.216788
	=	0.9579

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)
	=	(2620.313 / 3233.508)	/	(3029.321 / 3650.322)
	=	0.810362	/	0.829878
	=	0.9765

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 - (996.809 + 693.607) / 6470.537)	/	(1 - (944.157 + 609.966) / 4830.826)
	=	0.738752	/	0.67829
	=	1.0891

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
	=	3650.322	/	3233.508
	=	1.1289

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))
	=	(337.982 / (337.982 + 609.966))	/	(436.655 / (436.655 + 693.607))
	=	0.356541	/	0.386331
	=	0.9229

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)
	=	(2271.513 / 3650.322)	/	(1857.061 / 3233.508)
	=	0.622277	/	0.574318
	=	1.0835

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)
	=	((2184.125 + 870.698) / 6470.537)	/	((1196.838 + 749.892) / 4830.826)
	=	0.472113	/	0.402981
	=	1.1716

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
	=	(73.015 - -74.112	-	420.874)	/	6470.537
	=	-0.042307

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.

TELUS International (Cda) has a M-score of -2.66 suggests that the company is unlikely to be a manipulator.

TELUS International (Cda) Beneish M-Score Related Terms

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TELUS International (Cda) (TSX:TIXT) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » TELUS International (Cda) Inc (TSX:TIXT) » Definitions » Beneish M-Score

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Traded in Other Exchanges

TIXT:USA 5Z9:Germany

Address

510 West Georgia Street, Floor 7, Vancouver, BC, CAN, V6B 0M3

Website

https://www.telusinternational.com

TELUS International (Cda) Inc is a digital customer experience innovator that designs, builds, and delivers next-generation solutions. Its clients include companies across several verticals, including Tech and Games, eCommerce and FinTech, Banking, Financial Services and Insurance, Communications and Media, and Travel and Hospitality. The solutions offered by the company include Digital Experience, Customer Experience, Advisory Services, and Back Office and Automation among other services. Geographically, it derives a majority of its revenue from the European region.