Citigroup Beneish M Score

C -  USA Stock  

USD 49.32  1.73  3.39%

This module uses fundamental data of Citigroup to approximate the value of its Beneish M Score. Citigroup 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. Continue to Citigroup Piotroski F Score and Citigroup Altman Z Score analysis.
  
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The current year Debt to Equity Ratio is expected to grow to 10.43, whereas Long Term Debt is forecasted to decline to about 311 B. Citigroup Calculated Tax Rate is projected to slightly grow based on the last few years of reporting. The past year's Calculated Tax Rate was at 16.67. The current year Cash and Equivalents Turnover is expected to grow to 0.52, whereas Cash Flow Per Share is forecasted to decline to (11.69) .
At this time, it appears that Citigroup is an unlikely manipulator. The earnings manipulation may begin if Citigroup'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 Citigroup 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 Citigroup'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.
-3.17
Beneish M Score - Unlikely Manipulator
Elasticity of Receivables0.92Focus
Asset QualityN/AFocus
Expense Coverage0.97Focus
Gross Margin Strengs1.02Focus
Accruals Factor0.97Focus
Depreciation ResistanceN/AFocus
Net Sales Growth0.96Focus
Financial Leverage Condition0.98Focus

Citigroup 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 Citigroup'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
Revenues69 B71.9 B
Sufficiently Down
Decreasing
Slightly volatile
Selling General and Administrative Expense44.9 B48.2 B
Significantly Down
Decreasing
Slightly volatile
Net Cash Flow from Operations66.1 B61.2 B
Significantly Up
Decreasing
Stable
Depreciation Amortization and Accretion4.1 BB
Sufficiently Up
Increasing
Slightly volatile
Total Assets2324.3 B2291.4 B
Fairly Up
Increasing
Slightly volatile
Investments1858.7 B1823.4 B
Fairly Up
Increasing
Slightly volatile
Trade and Non Trade Receivables48.3 B54.3 B
Fairly Down
Increasing
Slightly volatile
Total Liabilities2100.1 B2088.7 B
Slightly Up
Increasing
Slightly volatile
Total Debt443.7 B473.6 B
Notably Down
Decreasing
Slightly volatile
Operating Income25.8 B27.5 B
Notably Down
Increasing
Slightly volatile
Gross Margin1.071.053
Fairly Up
Increasing
Slightly volatile

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

About Citigroup 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.

EBITDA Margin

0.41

Share
Citigroup EBITDA Margin is projected to increase slightly based on the last few years of reporting. The past year's EBITDA Margin was at 0.44

Citigroup 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 Citigroup. 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.
201720182019202020212022 (projected)
Trade and Non Trade Receivables38.38 B35.45 B39.86 B44.81 B54.34 B48.27 B
Revenues72.44 B72.85 B75.07 B75.5 B71.88 B69.04 B
Total Assets1,842.46 B1,917.38 B1,951.16 B2,260.09 B2,291.41 B2,324.26 B
Depreciation Amortization and Accretion3.66 B3.75 B3.9 B3.94 B3.96 B4.12 B
Selling General and Administrative Expense42.23 B41.84 B42.78 B44.37 B48.19 B44.85 B
Total Liabilities1,640.79 B1,720.31 B1,757.21 B2,059.89 B2,088.74 B2,100.06 B
Total Debt437.44 B442.11 B460.15 B500.73 B473.63 B443.69 B
Operating Income22.76 B23.45 B23.9 B13.63 B27.47 B25.75 B
Net Cash Flow from Operations(8.77 B)36.95 B(12.84 B)(20.62 B)61.25 B66.08 B
Investments1,492.24 B1,557.29 B1,582.72 B1,768.08 B1,823.37 B1,858.66 B

About Citigroup Fundamental Analysis

The Macroaxis Fundamental Analysis modules help investors analyze Citigroup's financials across various querterly and yearly statements, indicators and fundamental ratios. We help investors to determine the real value of Citigroup using virtually all public information available. We use both quantitative as well as qualitative analysis to arrive at the intrinsic value of Citigroup 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.
Citigroup Inc., a diversified financial services holding company, provides various financial products and services to consumers, corporations, governments, and institutions in North America, Latin America, Asia, Europe, the Middle East, and Africa. Citigroup Inc. was founded in 1812 and is headquartered in New York, New York. Citigroup operates under BanksDiversified classification in the United States and is traded on New York Stock Exchange. It employs 223000 people.

Citigroup Investors Sentiment

The influence of Citigroup's investor sentiment on the probability of its price appreciation or decline could be a good factor in your decision-making process regarding taking a position in Citigroup. The overall investor sentiment generally increases the direction of a stock movement in a one-year investment horizon. However, the impact of investor sentiment on the entire stock markets does not have a solid backing from leading economists and market statisticians.

Citigroup Implied Volatility

    
  54.86  
Citigroup's implied volatility exposes the market's sentiment of Citigroup stock's possible movements over time. However, it does not forecast the overall direction of its price. In a nutshell, if Citigroup's implied volatility is high, the market thinks the stock has potential for high price swings in either direction. On the other hand, the low implied volatility suggests that Citigroup stock will not fluctuate a lot when Citigroup's options are near their expiration.
Some investors attempt to determine whether the market's mood is bullish or bearish by monitoring changes in market sentiment. Unlike more traditional methods such as technical analysis, investor sentiment usually refers to the aggregate attitude towards Citigroup in the overall investment community. So, suppose investors can accurately measure the market's sentiment. In that case, they can use it for their benefit. For example, some tools to gauge market sentiment could be utilized using contrarian indexes, Citigroup's short interest history, or implied volatility extrapolated from Citigroup options trading.

Current Sentiment - C

Citigroup Investor Sentiment

Most of Macroaxis users are currently bullish on Citigroup. What is your opinion about investing in Citigroup? Are you bullish or bearish?
Bullish
Bearish
98% Bullish
2% Bearish
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Pair Trading with Citigroup

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 Citigroup 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 Citigroup will appreciate offsetting losses from the drop in the long position's value.

Citigroup Pair Correlation

Correlation Analysis For Direct Indexing and Tax-loss Harvesting

The ability to find closely correlated positions to Citigroup could be a great tool in your tax-loss harvesting strategies, allowing investors a quick way to find a similar-enough asset to replace Citigroup 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 Citigroup - 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 Citigroup to buy it.
The correlation of Citigroup is a statistical measure of how it moves in relation to other equities. 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 Citigroup moves, either up or down, the other security will move in the same direction. Alternatively, perfect negative correlation means that if Citigroup 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 Citigroup 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.
Pair CorrelationCorrelation Matching
Continue to Citigroup Piotroski F Score and Citigroup Altman Z Score analysis. Note that the Citigroup information on this page should be used as a complementary analysis to other Citigroup's statistical models used to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try Analyst Recommendations module to analyst recommendations and target price estimates broken down by several categories.

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When running Citigroup price analysis, check to measure Citigroup'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 Citigroup is operating at the current time. Most of Citigroup's value examination focuses on studying past and present price action to predict the probability of Citigroup's future price movements. You can analyze the entity against its peers and financial market as a whole to determine factors that move Citigroup's price. Additionally, you may evaluate how the addition of Citigroup to your portfolios can decrease your overall portfolio volatility.
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Is Citigroup's industry 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 Citigroup. If investors know Citigroup 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 Citigroup listed above have to be considered, but the key to understanding future value is determining which factors weigh more heavily than others.
The market value of Citigroup is measured differently than its book value, which is the value of Citigroup that is recorded on the company's balance sheet. Investors also form their own opinion of Citigroup's value that differs from its market value or its book value, called intrinsic value, which is Citigroup'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 Citigroup's market value can be influenced by many factors that don't directly affect Citigroup'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 Citigroup's value and its price as these two are different measures arrived at by different means. Investors typically determine Citigroup value by looking at such factors as earnings, sales, fundamental and technical indicators, competition as well as analyst projections. However, Citigroup'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.