Telefonaktiebolaget Lm Ericsson Stock Beneish M Score

ERIC Stock  USD 7.87  0.04  0.51%   
This module uses fundamental data of Telefonaktiebolaget to approximate the value of its Beneish M Score. Telefonaktiebolaget 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 Telefonaktiebolaget Piotroski F Score and Telefonaktiebolaget Altman Z Score analysis.
  
At present, Telefonaktiebolaget's Net Debt is projected to increase significantly based on the last few years of reporting. The current year's Short Term Debt is expected to grow to about 24 B, whereas Long Term Debt Total is forecasted to decline to about 22 B. At present, Telefonaktiebolaget's Days Sales Outstanding is projected to decrease significantly based on the last few years of reporting. The current year's Operating Cash Flow Per Share is expected to grow to 3.78, whereas Price To Sales Ratio is forecasted to decline to 0.87.
At this time, it appears that Telefonaktiebolaget is an unlikely manipulator. The earnings manipulation may begin if Telefonaktiebolaget'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 Telefonaktiebolaget 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 Telefonaktiebolaget'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.
-2.52
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables

1.6

Focus
Asset Quality

0.57

Focus
Expense Coverage

1.11

Focus
Gross Margin Strengs

0.93

Focus
Accruals Factor

1.11

Focus
Depreciation Resistance

1.52

Focus
Net Sales Growth

0.59

Focus
Financial Leverage Condition

0.95

Focus

Telefonaktiebolaget 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 Telefonaktiebolaget'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.
Current ValueLast YearChange From Last Year 10 Year Trend
Net Receivables60.1 B64.2 B
Notably Down
Pretty Stable
Total Revenue177.7 B302.9 B
Way Down
Slightly volatile
Total Assets209 B341.6 B
Way Down
Slightly volatile
Total Current Assets139.7 B178.2 B
Significantly Down
Very volatile
Non Current Assets Total171.5 B163.4 B
Sufficiently Up
Slightly volatile
Property Plant Equipment26.7 B25.4 B
Sufficiently Up
Slightly volatile
Depreciation And Amortization7.6 B12.8 B
Way Down
Pretty Stable
Selling General Administrative29.5 B45.1 B
Way Down
Slightly volatile
Total Current Liabilities78.6 B148.8 B
Way Down
Slightly volatile
Non Current Liabilities Total43.4 B80.8 B
Way Down
Slightly volatile
Short Term Debt24 B22.9 B
Sufficiently Up
Slightly volatile
Long Term Debt35.3 B33.6 B
Sufficiently Up
Slightly volatile
Total Cash From Operating Activities14.6 B8.3 B
Way Up
Pretty Stable
Short Term Investments24.1 B13.6 B
Way Up
Slightly volatile
Long Term Investments23.6 B24 B
Fairly Down
Slightly volatile
Gross Profit Margin0.430.46
Notably Down
Slightly volatile

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

About Telefonaktiebolaget 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.

Total Assets

208.96 Billion

At present, Telefonaktiebolaget's Total Assets are projected to increase significantly based on the last few years of reporting.

Telefonaktiebolaget 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 Telefonaktiebolaget. 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.
202020212022202320242025 (projected)
Net Receivables55.3B58.6B63.2B55.8B64.2B60.1B
Total Revenue232.4B232.3B271.5B263.4B302.9B177.7B
Total Assets271.5B305.6B349.5B297.0B341.6B209.0B
Total Current Assets149.8B174.8B173.8B155.0B178.2B139.7B
Net Debt(4.2B)(12.9B)3.9B19.1B17.2B18.1B
Short Term Debt10.1B11.8B8.5B19.9B22.9B24.0B
Long Term Debt22.2B22.2B26.9B29.2B33.6B35.3B
Operating Income27.8B31.8B27.1B12.0B13.8B11.3B
Investments(15.2B)(15.3B)(34.4B)(8.7B)(7.8B)(8.2B)

Telefonaktiebolaget 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, Telefonaktiebolaget's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Telefonaktiebolaget's managers, analysts, and investors.
65.4%
Environmental
Governance
Social

About Telefonaktiebolaget Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Telefonaktiebolaget LM Ericsson's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Telefonaktiebolaget using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Telefonaktiebolaget LM Ericsson 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.

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When determining whether Telefonaktiebolaget offers a strong return on investment in its stock, a comprehensive analysis is essential. The process typically begins with a thorough review of Telefonaktiebolaget's financial statements, including income statements, balance sheets, and cash flow statements, to assess its financial health. Key financial ratios are used to gauge profitability, efficiency, and growth potential of Telefonaktiebolaget Lm Ericsson Stock. Outlined below are crucial reports that will aid in making a well-informed decision on Telefonaktiebolaget Lm Ericsson Stock:
Check out Telefonaktiebolaget Piotroski F Score and Telefonaktiebolaget Altman Z Score analysis.
You can also try the Analyst Advice module to analyst recommendations and target price estimates broken down by several categories.
Is Communications Equipment 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 Telefonaktiebolaget. If investors know Telefonaktiebolaget 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 Telefonaktiebolaget 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
0.407
Dividend Share
2.85
Revenue Per Share
74.394
Quarterly Revenue Growth
0.014
Return On Assets
0.0522
The market value of Telefonaktiebolaget is measured differently than its book value, which is the value of Telefonaktiebolaget that is recorded on the company's balance sheet. Investors also form their own opinion of Telefonaktiebolaget's value that differs from its market value or its book value, called intrinsic value, which is Telefonaktiebolaget'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 Telefonaktiebolaget's market value can be influenced by many factors that don't directly affect Telefonaktiebolaget'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 Telefonaktiebolaget's value and its price as these two are different measures arrived at by different means. Investors typically determine if Telefonaktiebolaget is a good investment by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Telefonaktiebolaget'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.