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Abercrombie & Fitch Co (NYSE:ANF)
Piotroski F-Score
6 (As of Today)

The zones of discrimination were as such:

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Abercrombie & Fitch Co has an F-score of 6 indicating the company's financial situation is typical for a stable company.

ANF' s Piotroski F-Score Range Over the Past 10 Years
Min: 4   Max: 9
Current: 6

4
9

During the past 13 years, the highest Piotroski F-Score of Abercrombie & Fitch Co was 9. The lowest was 4. And the median was 6.


Definition

How is the Piotroski F-Score calculated?

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

This Year (Oct16) TTM:Last Year (Oct15) TTM:
Net Income was 57.741 + -39.587 + -13.129 + 7.881 = $13 Mil.
Cash Flow from Operations was 243.401 + -76.283 + 18.424 + 79.237 = $265 Mil.
Revenue was 1112.93 + 685.483 + 783.16 + 821.734 = $3,403 Mil.
Gross Profit was 676.345 + 425.721 + 477.107 + 510.739 = $2,090 Mil.
Average Total Assets from the begining of this year (Oct15)
to the end of this year (Oct16) was
(2512.744 + 2433.039 + 2344.182 + 2332.39 + 2336.468) / 5 = $2391.7646 Mil.
Total Assets at the begining of this year (Oct15) was $2,513 Mil.
Long-Term Debt was $334 Mil.
Total Current Assets was $1,150 Mil.
Total Current Liabilities was $526 Mil.
Net Income was 44.388 + -63.246 + -0.81 + 41.891 = $22 Mil.

Revenue was 1119.544 + 709.422 + 817.756 + 878.572 = $3,525 Mil.
Gross Profit was 681.885 + 411.549 + 509.862 + 559.787 = $2,163 Mil.
Average Total Assets from the begining of last year (Oct14)
to the end of last year (Oct15) was
(2575.569 + 2505.167 + 2364.592 + 2422.201 + 2512.744) / 5 = $2476.0546 Mil.
Total Assets at the begining of last year (Oct14) was $2,576 Mil.
Long-Term Debt was $336 Mil.
Total Current Assets was $1,213 Mil.
Total Current Liabilities was $644 Mil.

Profitability

Question 1. Return on Assets (ROA)

Net income before extraordinary items for the year divided by total assets at the beginning of the year.

Score 1 if positive, 0 if negative.

Abercrombie & Fitch Co's current net income (TTM) was 13. ==> Positive ==> Score 1.

Question 2. Cash Flow Return on Assets (CFROA)

Net cash flow from operating activities (operating cash flow) divided by total assets at the beginning of the year.

Score 1 if positive, 0 if negative.

Abercrombie & Fitch Co's current cash flow from operations (TTM) was 265. ==> Positive ==> Score 1.

Question 3. Change in Return on Assets

Compare this year’s return on assets (1) to last year’s return on assets.

Score 1 if it’s higher, 0 if it’s lower.

ROA (This Year)=Net Income (TTM)/Total Assets at the Beginning of This Year (Oct15)
=12.906/2512.744
=0.00513622

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Oct14)
=22.223/2575.569
=0.00862838

Abercrombie & Fitch Co's return on assets of this year was 0.00513622. Abercrombie & Fitch Co's return on assets of last year was 0.00862838. ==> Last year is higher ==> Score 0.

Question 4. Quality of Earnings (Accrual)

Compare Cash flow return on assets (2) to return on assets (1)

Score 1 if CFROA > ROA, 0 if CFROA <= ROA.

Abercrombie & Fitch Co's current net income (TTM) was 13. Abercrombie & Fitch Co's current cash flow from operations (TTM) was 265. ==> 265 > 13 ==> CFROA > ROA ==> Score 1.

Funding

Question 5. Change in Gearing or Leverage

Compare this year’s gearing (long-term debt divided by average total assets) to last year’s gearing.

Score 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year: Oct16)=Long-Term Debt/Average Total Assets from Oct15 to Oct16
=333.839/2391.7646
=0.13957854

Gearing (Last Year: Oct15)=Long-Term Debt/Average Total Assets from Oct14 to Oct15
=336.461/2476.0546
=0.13588594

Abercrombie & Fitch Co's gearing of this year was 0.13957854. Abercrombie & Fitch Co's gearing of last year was 0.13588594. ==> Last year is lower than this year ==> Score 0.

Question 6. Change in Working Capital (Liquidity)

Compare this year’s current ratio (current assets divided by current liabilities) to last year’s current ratio.

Score 1 if this year'’s current ratio is higher, 0 if it’s lower

Current Ratio (This Year: Oct16)=Total Current Assets/Total Current Liabilities
=1150.271/526.122
=2.1863199

Current Ratio (Last Year: Oct15)=Total Current Assets/Total Current Liabilities
=1213.155/644.41
=1.88258252

Abercrombie & Fitch Co's current ratio of this year was 2.1863199. Abercrombie & Fitch Co's current ratio of last year was 1.88258252. ==> This year's current ratio is higher. ==> Score 1.

Question 7. Change in Shares in Issue

Compare the number of shares in issue this year, to the number in issue last year.

Score 0 if there is larger number of shares in issue this year, 1 otherwise.

Abercrombie & Fitch Co's number of shares in issue this year was 68.3. Abercrombie & Fitch Co's number of shares in issue last year was 69.3. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

Efficiency

Question 8. Change in Gross Margin

Compare this year’s gross margin (gross profit divided by sales) to last year’s.

Score 1 if this year’s gross margin is higher, 0 if it’s lower.

Gross Margin (This Year: TTM)=Gross Profit/Revenue
=2089.912/3403.307
=0.61408271

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=2163.083/3525.294
=0.61358939

Abercrombie & Fitch Co's gross margin of this year was 0.61408271. Abercrombie & Fitch Co's gross margin of last year was 0.61358939. ==> This year's gross margin is higher. ==> Score 1.

Question 9. Change in asset turnover

Compare this year’s asset turnover (total sales for the year divided by total assets at the beginning of the year) to last year’s asset turnover ratio.

Score 1 if this year’s asset turnover ratio is higher, 0 if it’s lower

Asset Turnover (This Year)=Revenue (TTM)/Total Assets at the Beginning of This Year (Oct15)
=3403.307/2512.744
=1.35441852

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Oct14)
=3525.294/2575.569
=1.36874376

Abercrombie & Fitch Co's asset turnover of this year was 1.35441852. Abercrombie & Fitch Co's asset turnover of last year was 1.36874376. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score= Que. 1+ Que. 2+ Que. 3+Que. 4+Que. 5+Que. 6+Que. 7+Que. 8+Que. 9
=1+1+0+1+0+1+1+1+0
=6

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Abercrombie & Fitch Co has an F-score of 6 indicating the company's financial situation is typical for a stable company.


Explanation

The developer of the system is Joseph D. Piotroski is relatively unknown accounting professor who shuns publicity and rarely gives interviews.

He graduated from the University of Illinois with a B.S. in accounting in 1989, received an M.B.A. from Indiana University in 1994. Five years later, in 1999, after earning a Ph.D. in accounting from the University of Michigan, he became an associate professor of accounting at the University of Chicago.

In 2000, he wrote a research paper called "Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers" (pdf).

He wanted to see if he can develop a system (using a simple nine-point scoring system) that can increase the returns of a strategy of investing in low price to book (referred to in the paper as high book to market) value companies.

What he found was something that exceeded his most optimistic expectations.

Buying only those companies that scored highest (8 or 9) on his nine-point scale, or F-Score as he called it, over the 20 year period from 1976 to 1996 led to an average out-performance over the market of 13.4%.

Even more impressive were the results of a strategy of investing in the highest F-Score companies (8 or 9) and shorting companies with the lowest F-Score (0 or 1).

Over the same period from 1976 to 1996 (20 years) this strategy led to an average yearly return of 23%, substantially outperforming the average S&P 500 index return of 15.83% over the same period.


Related Terms

Net Income, Cash Flow from Operations, Revenue, Gross Profit, Total Assets, Long-Term Debt, Total Current Assets, Total Current Liabilities


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

Abercrombie & Fitch Co Annual Data

Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16
Question 1 1111111111
Question 2 1111111111
Question 3 0000101000
Question 4 1111111111
Question 5 1101110000
Question 6 1011000110
Question 7 0111011111
Question 8 1100001100
Question 9 0000111001
F-score 6656667655

Abercrombie & Fitch Co Quarterly Data

Jul14Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16Oct16
Question 1 1111011111
Question 2 1111111111
Question 3 0000000110
Question 4 1111111111
Question 5 1000000000
Question 6 0111100011
Question 7 1111111111
Question 8 0000010111
Question 9 0000001110
F-score 5555455786
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