| LAMR Stock | | | USD 133.42 3.07 2.36% |
This module uses fundamental data of Lamar Advertising to approximate the value of its Beneish M Score. Lamar Advertising 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
Lamar Advertising Piotroski F Score and
Lamar Advertising Altman Z Score analysis.
To learn how to invest in Lamar Stock, please use our
How to Invest in Lamar Advertising guide.
At this time, Lamar Advertising's
Short Term Debt is relatively stable compared to the past year. As of 11/25/2024,
Net Debt To EBITDA is likely to grow to 5.49, while
Net Debt is likely to drop slightly above 2.3
B. At this time, Lamar Advertising's
EV To Sales is relatively stable compared to the past year. As of 11/25/2024,
Free Cash Flow Per Share is likely to grow to 6.24, while
Free Cash Flow Yield is likely to drop 0.04.
At this time, it appears that Lamar Advertising is an unlikely manipulator. The earnings manipulation may begin if Lamar Advertising'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 Lamar Advertising 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 Lamar Advertising'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.
-3.28
Beneish M Score - Unlikely Manipulator
| Elasticity of Receivables | |
| Financial Leverage Condition | |
Lamar Advertising 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 Lamar Advertising'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.
Lamar Advertising 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 Lamar Advertising's different financial indicators related to revenue, expenses, operating profit, and net earnings helps investors identify and prioritize their investing strategies towards Lamar Advertising in a much-optimized way. Analyzing correlations between earnings drivers directly associated with dollar figures is the most effective way to find Lamar Advertising's degree of accounting gimmicks and manipulations.
Click cells to compare fundamentals
About Lamar Advertising 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.
Lamar Advertising 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 Lamar Advertising. 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.
Lamar Advertising 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, Lamar Advertising's sustainability indicators can be used to identify proper investment strategies using environmental, social, and governance scores that are crucial to Lamar Advertising's managers, analysts, and investors.
About Lamar Advertising Fundamental Analysis
The Macroaxis Fundamental Analysis modules help investors analyze Lamar Advertising's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Lamar Advertising using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at
the intrinsic value of Lamar Advertising 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.
Pair Trading with Lamar Advertising
One of the main advantages of trading using pair correlations is that every trade hedges away some risk. Because there are two separate transactions required, even if Lamar Advertising position performs unexpectedly, the other equity can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Lamar Advertising will appreciate offsetting losses from the drop in the long position's value.
The ability to find closely correlated positions to Lamar Advertising could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Lamar Advertising when you sell it. If you don't do this, your portfolio allocation will be skewed against your target asset allocation. So, investors can't just sell and buy back Lamar Advertising - that would be a violation of the tax code under the "wash sale" rule, and this is why you need to find a similar enough asset and use the proceeds from selling Lamar Advertising to buy it.
The correlation of Lamar Advertising is a statistical measure of how it moves in relation to other instruments. This measure is expressed in what is known as the correlation coefficient, which ranges between -1 and +1. A perfect positive correlation (i.e., a correlation coefficient of +1) implies that as Lamar Advertising moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Lamar Advertising moves in either direction, the perfectly negatively correlated security will move in the opposite direction. If the correlation is 0, the equities are not correlated; they are entirely random. A correlation greater than 0.8 is generally described as strong, whereas a correlation less than 0.5 is generally considered weak.
Correlation analysis and pair trading evaluation for Lamar Advertising can also be used as hedging techniques within a particular sector or industry or even over random equities to generate a better risk-adjusted return on your portfolios.
Additional Tools for Lamar Stock Analysis
When running Lamar Advertising's price analysis, check to
measure Lamar Advertising's 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 Lamar Advertising is operating at the current time. Most of Lamar Advertising's value examination focuses on studying past and present price action to
predict the probability of Lamar Advertising's future price movements. You can analyze the entity against its peers and the financial market as a whole to determine factors that move Lamar Advertising's price. Additionally, you may evaluate how the addition of Lamar Advertising to your portfolios can decrease your overall portfolio volatility.