Brookfield Business Partners Stock Beneish M Score

BBU Stock  USD 25.04  0.35  1.42%   
This module uses fundamental data of Brookfield Business to approximate the value of its Beneish M Score. Brookfield Business 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 Brookfield Business Piotroski F Score and Brookfield Business Altman Z Score analysis.
  
At this time, Brookfield Business' Long Term Debt To Capitalization is comparatively stable compared to the past year. Total Debt To Capitalization is likely to gain to 1.01 in 2024, whereas Debt Ratio is likely to drop 0.27 in 2024. At this time, Brookfield Business' Days Payables Outstanding is comparatively stable compared to the past year. ROE is likely to gain to 0.27 in 2024, whereas PTB Ratio is likely to drop 0.41 in 2024.
At this time, it appears that Brookfield Business is an unlikely manipulator. The earnings manipulation may begin if Brookfield Business' 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 Brookfield Business 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 Brookfield Business' 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.
-2.72
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables

1.31

Focus
Asset Quality

1.11

Focus
Expense Coverage

1.86

Focus
Gross Margin Strengs

0.95

Focus
Accruals Factor

1.86

Focus
Depreciation Resistance

1.0

Focus
Net Sales Growth

0.56

Focus
Financial Leverage Condition

0.87

Focus

Brookfield Business Beneish M-Score Indicator Trends

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 Brookfield Business' 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.
Current ValueLast YearChange From Last Year 10 Year Trend
Net Receivables4.4 BB
Way Down
Slightly volatile
Total Revenue30 B53.1 B
Way Down
Slightly volatile
Total Assets86.5 B82.4 B
Sufficiently Up
Slightly volatile
Total Current Assets10.1 B14.9 B
Way Down
Slightly volatile
Non Current Assets Total70.5 B67.2 B
Sufficiently Up
Slightly volatile
Property Plant Equipment19.2 B18.3 B
Sufficiently Up
Slightly volatile
Depreciation And Amortization2.9 B2.8 B
Sufficiently Up
Slightly volatile
Selling General Administrative1.6 B1.5 B
Sufficiently Up
Slightly volatile
Total Current Liabilities7.3 B14.4 B
Way Down
Slightly volatile
Non Current Liabilities Total28.5 B49.5 B
Way Down
Slightly volatile
Net Debt44.4 B42.3 B
Sufficiently Up
Slightly volatile
Short Term Debt3.8 B3.6 B
Sufficiently Up
Slightly volatile
Long Term Debt41.5 B39.5 B
Sufficiently Up
Slightly volatile
Total Cash From Operating Activities1.3 B2.1 B
Way Down
Slightly volatile
Short Term Investments743.2 M614.8 M
Fairly Up
Slightly volatile
Long Term Investments5.1 B7.1 B
Way Down
Slightly volatile
Gross Profit Margin0.03790.0399
Notably Down
Slightly volatile

Brookfield Business Beneish M-Score Driver Matrix

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 Brookfield Business' different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Brookfield Business in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Brookfield Business' degree of accounting gimmicks and manipulations.

About Brookfield Business Beneish M Score

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.

Other Operating Expenses

28.81 Billion

At this time, Brookfield Business' Other Operating Expenses is comparatively stable compared to the past year.

Brookfield Business 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 Brookfield Business. 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.
201920202021202220232024 (projected)
Net Receivables5.6B5.0B5.6B6.9B6.0B4.4B
Total Revenue43.0B37.6B46.6B57.5B53.1B30.0B
Total Assets51.8B54.7B64.2B89.5B82.4B86.5B
Total Current Assets12.9B13.0B14.6B17.9B14.9B10.1B
Net Debt20.4B21.0B26.5B47.9B42.3B44.4B
Short Term Debt1.4B610M1.6B4.7B3.6B3.8B
Long Term Debt21.3B23.2B27.5B46.7B39.5B41.5B
Operating Income2.0B2.0B(1.2B)(226M)549.9M372.8M
Investments(17.9B)(2.3B)(8.9B)(18.7B)2.5B2.7B

Brookfield Business ESG Sustainability

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, Brookfield Business' sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Brookfield Business' managers, analysts, and investors.
Environmental
Governance
Social

About Brookfield Business Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Brookfield Business Partners's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Brookfield Business using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Brookfield Business Partners 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.
Please read more on our fundamental analysis page.

Thematic Opportunities

Explore Investment Opportunities

Build portfolios using Macroaxis predefined set of investing ideas. Many of Macroaxis investing ideas can easily outperform a given market. Ideas can also be optimized per your risk profile before portfolio origination is invoked. Macroaxis thematic optimization helps investors identify companies most likely to benefit from changes or shifts in various micro-economic or local macro-level trends. Originating optimal thematic portfolios involves aligning investors' personal views, ideas, and beliefs with their actual investments.
Explore Investing Ideas  

Additional Tools for Brookfield Stock Analysis

When running Brookfield Business' price analysis, check to measure Brookfield Business' market volatility, profitability, liquidity, solvency, efficiency, growth potential, financial leverage, and other vital indicators. We have many different tools that can be utilized to determine how healthy Brookfield Business is operating at the current time. Most of Brookfield Business' value examination focuses on studying past and present price action to predict the probability of Brookfield Business' future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Brookfield Business' price. Additionally, you may evaluate how the addition of Brookfield Business to your portfolios can decrease your overall portfolio volatility.