Deutsche Telekom AG (XTER:DTE) Beneish M-Score : -2.73 (As of Apr. 30, 2024)

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What is Deutsche Telekom AG 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 -2.73 no higher than -1.78, which implies that the company is unlikely to be a manipulator.

The historical rank and industry rank for Deutsche Telekom AG's Beneish M-Score or its related term are showing as below:

XTER:DTE' s Beneish M-Score Range Over the Past 10 Years
Min: -3.07 Med: -2.81 Max: -2.57
Current: -2.73

During the past 13 years, the highest Beneish M-Score of Deutsche Telekom AG was -2.57. The lowest was -3.07. And the median was -2.81.

Deutsche Telekom AG Beneish M-Score Historical Data

The historical data trend for Deutsche Telekom AG'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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Deutsche Telekom AG Beneish M-Score Chart

Deutsche Telekom AG Annual Data

Trend

Dec14

Dec15

Dec16

Dec17

Dec18

Dec19

Dec20

Dec21

Dec22

Dec23

Beneish M-Score

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-3.01

-2.66

-2.79

-2.83

-2.73

Deutsche Telekom AG 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															-2.83	-2.71	-2.68	-2.66	-2.73

Competitive Comparison of Deutsche Telekom AG's Beneish M-Score

For the Telecom Services subindustry, Deutsche Telekom AG'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.

Deutsche Telekom AG's Beneish M-Score Distribution in the Telecommunication Services Industry

For the Telecommunication Services industry and Communication Services sector, Deutsche Telekom AG's Beneish M-Score distribution charts can be found below:

* The bar in red indicates where Deutsche Telekom AG's Beneish M-Score falls into.

Deutsche Telekom AG 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 Deutsche Telekom AG 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 * 1.0053

0.528 * 0.9339

0.404 * 1.0025

0.892 * 0.9752

0.115 * 1.1103

0.172 * SGAI

4.679 * TATA

0.327 * LVGI

0.172 * 0.4907

4.679 * -0.067205

0.327 * 0.9624

-2.73

This Year (Dec23) TTM:

Last Year (Dec22) TTM:

Total Receivables was €23,324 Mil.
Revenue was 28707 + 27556 + 27060 + 27652 = €110,975 Mil.
Gross Profit was 16170 + 17086 + 16623 + 16611 = €66,490 Mil.
Total Current Assets was €36,363 Mil.
Total Assets was €290,305 Mil.
Property, Plant and Equipment(Net PPE) was €86,018 Mil.
Depreciation, Depletion and Amortization(DDA) was €23,974 Mil.
Selling, General, & Admin. Expense(SGA) was €456 Mil.
Total Current Liabilities was €36,065 Mil.
Long-Term Debt & Capital Lease Obligation was €127,432 Mil.
Net Income was -1035 + 1924 + 1539 + 15360 = €17,788 Mil.
Non Operating Income was 0 + 0 + 0 + 0 = €0 Mil.
Cash Flow from Operations was 8742 + 9692 + 9306 + 9558 = €37,298 Mil.

Total Receivables was €23,793 Mil.
Revenue was 29155 + 28925 + 27697 + 28024 = €113,801 Mil.
Gross Profit was 15449 + 16594 + 15841 + 15789 = €63,673 Mil.
Total Current Assets was €39,144 Mil.
Total Assets was €298,590 Mil.
Property, Plant and Equipment(Net PPE) was €87,160 Mil.
Depreciation, Depletion and Amortization(DDA) was €27,826 Mil.
Selling, General, & Admin. Expense(SGA) was €953 Mil.
Total Current Liabilities was €45,389 Mil.
Long-Term Debt & Capital Lease Obligation was €129,341 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)
	=	(23324 / 110975)	/	(23793 / 113801)
	=	0.210173	/	0.209075
	=	1.0053

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)
	=	(63673 / 113801)	/	(66490 / 110975)
	=	0.559512	/	0.599144
	=	0.9339

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 - (36363 + 86018) / 290305)	/	(1 - (39144 + 87160) / 298590)
	=	0.57844	/	0.576999
	=	1.0025

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
	=	110975	/	113801
	=	0.9752

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))
	=	(27826 / (27826 + 87160))	/	(23974 / (23974 + 86018))
	=	0.241995	/	0.217961
	=	1.1103

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)
	=	(456 / 110975)	/	(953 / 113801)
	=	0.004109	/	0.008374
	=	0.4907

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)
	=	((127432 + 36065) / 290305)	/	((129341 + 45389) / 298590)
	=	0.56319	/	0.585184
	=	0.9624

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
	=	(17788 - 0	-	37298)	/	290305
	=	-0.067205

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.

Deutsche Telekom AG has a M-score of -2.73 suggests that the company is unlikely to be a manipulator.

Deutsche Telekom AG Beneish M-Score Related Terms

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Deutsche Telekom AG (XTER:DTE) Business Description

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Traded in Other Exchanges

DTEGY:USA DTEGF:USA DTE:Romania DTE:Mexico DTE:Italy DEUTSCHETEL:Hungary DTEd:UK 0MPH:UK DTE:Czech Republic DTE:Austria

Address

Friedrich-Ebert-Allee 140, Bonn, DEU, 53113

Website

https://www.telekom.com

Deutsche Telekom is the incumbent telecom operator in Germany and remains the dominant player in both mobile and fixed markets. It also owns a controlling stake in T-Mobile US—one of three primary wireless carriers in the United States—which merged with Sprint in 2020, consolidating the market from four to three operators. Aside from its two core markets, Deutsche Telekom also has operations in several Central European countries and holds an IT arm (Systems Solutions).

Executives