This module uses fundamental data of Azul SA to approximate the value of its Beneish M Score. Azul SA M Score tells investors if the company management is likely to be manipulating earnings. The score is calculated using eight financial indicators that are adjusted by a specific multiplier. Please note, the M Score is a probabilistic model and cannot detect companies that manipulate their earnings with 100% accuracy. Check out Azul SA Piotroski F Score and Azul SA Altman Z Score analysis.
At this time, Azul SA's Interest Debt Per Share is quite stable compared to the past year. Total Debt To Capitalization is expected to rise to 4.97 this year, although the value of Net Debt To EBITDA will most likely fall to 6.27. At this time, Azul SA's ROIC is quite stable compared to the past year. Days Of Inventory On Hand is expected to rise to 22.82 this year, although the value of PTB Ratio is projected to rise to (0.26).
At this time, it appears that Azul SA is an unlikely manipulator. The earnings manipulation may begin if Azul SA's top management creates an artificial sense of financial success, forcing the stock price to be traded at a high price-earnings multiple than it should be. In general, excessive earnings management by Azul SA executives may lead to removing some of the operating profits from subsequent periods to inflate earnings in the following periods. This way, the manipulation of Azul SA's earnings can lead to misrepresentations of actual financial condition, taking the otherwise loyal stakeholders on to the path of questionable ethical practices and plain fraud.
The cure to earnings manipulation is the transparency of financial reporting. It will typically remove the temptation of the top executives to inflate earnings (i.e., to promote the idea of 'winning at any cost'). Because a healthy internal audit department can enhance transparency, the board should promote the auditors' access to all the record-keeping systems across the enterprise. For example, if Azul SA's auditors report directly to the board (not management), the managers will be reluctant to manipulate simply due to the fear of punishment. On the other hand, the auditors will be free to investigate the ledgers properly because they know that the board has their back.
One of the toughest challenges investors face today is learning how to quickly synthesize historical financial statements and information provided by the company, SEC reporting, and various external parties in order to detect the potential manipulation of earnings. Understanding the correlation between Azul SA's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Azul SA in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Azul SA's degree of accounting gimmicks and manipulations.
M-Score is one of many grading techniques for value stocks. It was developed by Professor M. Daniel Beneish of the Kelley School of Business at Indiana University and published in 1999 under the paper titled The Detection of Earnings Manipulation. The Beneish score is a multi-factor model that utilizes financial identifiers to compile eight variables used to classify whether a company has manipulated its reported earnings. The variables are built from the officially filed financial statements to create a final score call 'M Score.' The score helps to identify companies that are likely to manipulate their profits if they show deteriorating gross margins, operating expenses, and leverage against growing revenue.
Total Assets
11.86 Billion
At this time, Azul SA's Total Assets are quite stable compared to the past year.
Azul SA Earnings Manipulation Drivers
Although earnings manipulation is typically not the result of intentional misconduct by the c-level executives, it is still a widespread practice by the senior management of public companies such as Azul SA. It is usually done by a series of misrepresentations of various accounting rules and operating activities across multiple financial cycles. The best way to spot the manipulation is to examine the historical financial statement to find inconsistencies in earning reports to find trends in assets or liabilities that are not sustainable in the future.
Some studies have found that companies with high sustainability scores are getting higher valuations than competitors with lower social-engagement activities. While most ESG disclosures are voluntary and do not directly affect the long term financial condition, Azul SA's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Azul SA's managers, analysts, and investors.
Environmental
Governance
Social
About Azul SA Fundamental Analysis
The Macroaxis Fundamental Analysis modules help investors analyze Azul SA's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Azul SA using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Azul SA based on its fundamental data. In general, a quantitative approach, as applied to this company, focuses on analyzing financial statements comparatively, whereas a qaualitative method uses data that is important to a company's growth but cannot be measured and presented in a numerical way.
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When determining whether Azul SA is a strong investment it is important to analyze Azul SA's competitive position within its industry, examining market share, product or service uniqueness, and competitive advantages. Beyond financials and market position, potential investors should also consider broader economic conditions, industry trends, and any regulatory or geopolitical factors that may impact Azul SA's future performance. For an informed investment choice regarding Azul Stock, refer to the following important reports:
For more information on how to buy Azul Stock please use our How to buy in Azul Stock guide.You can also try the Portfolio Center module to all portfolio management and optimization tools to improve performance of your portfolios.
Is Passenger Airlines space expected to grow? Or is there an opportunity to expand the business' product line in the future? Factors like these will boost the valuation of Azul SA. If investors know Azul will grow in the future, the company's valuation will be higher. The financial industry is built on trying to define current growth potential and future valuation accurately. All the valuation information about Azul SA listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
Quarterly Earnings Growth
(0.56)
Earnings Share
(3.43)
Revenue Per Share
161.325
Quarterly Revenue Growth
(0.02)
Return On Assets
0.0685
The market value of Azul SA is measured differently than its book value, which is the value of Azul that is recorded on the company's balance sheet. Investors also form their own opinion of Azul SA's value that differs from its market value or its book value, called intrinsic value, which is Azul SA's true underlying value. Investors use various methods to calculate intrinsic value and buy a stock when its market value falls below its intrinsic value. Because Azul SA's market value can be influenced by many factors that don't directly affect Azul SA's underlying business (such as a pandemic or basic market pessimism), market value can vary widely from intrinsic value.
Please note, there is a significant difference between Azul SA's value and its price as these two are different measures arrived at by different means. Investors typically determine if Azul SA is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Azul SA's price is the amount at which it trades on the open market and represents the number that a seller and buyer find agreeable to each party.