Brookfield Business Corporation — Earnings Quality Grade F
BBUC · Industrials
Major red flags
Screening Summary
Management Signals
Financial Trends
Revenue & Net Income ($B)
Margins (%)
18-Point Screening
Revenue Quality
DSO surged by 41 days (47 → 87)
AR outpaced revenue for 2 consecutive years
Revenue -32.4%, CFFO -1.6%. Cash follows revenue
Expense Quality
Inventory growth 6.0% far exceeds COGS -36.5%, margin rising. Fraud signal
CapEx growth -18.3% vs revenue -32.4%. Normal
SG&A/Gross Profit = 21.7%, excellent (<30%)
Gross margin swung +5.2pp (14.1% → 19.3%)
Cash Flow Quality
CFFO far exceeds NI (ratio 124.2x). Non-cash charges depressing profits
FCF $1.2B, FCF/NI = 45.00
Accruals ratio = -4.2%. Low accruals
Cash $4.3B covers only 10% of debt $44.6B
Balance Sheet Health
Goodwill+Intangibles $31.8B but equity unavailable or non-positive
Debt/EBITDA = 6.2x (>4x). Financial stress
Other assets grew 132.8% vs revenue -32.4%
No write-off data
Acquisition Risk
FCF after acquisitions negative for 2/3 years
Goodwill+Intangibles change 4% YoY. Normal
Manipulation Score
M-Score = -2.37 (< -2.22). Unlikely manipulator
Portfolio monitoring
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Beneish M-Score
Altman Z-Score
Generated from public financial data using forensic accounting frameworks. Not investment advice. Data: Yahoo Finance · 2026-04-25