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Benchmark Electronics (NYSE:BHE)
Piotroski F-Score
7 (As of Today)

Good Sign:

Piotroski F-Score of 7 is 7, indicating very healthy situation.

The zones of discrimination were as such:

Good or high score = 8 or 9
Bad or low score = 0 or 1

Benchmark Electronics has an F-score of 7 indicating the company's financial situation is typical for a stable company.

BHE' s 10-Year Piotroski F-Score Range
Min: 3   Max: 9
Current: 7

3
9

During the past 13 years, the highest Piotroski F-Score of Benchmark Electronics was 9. The lowest was 3. And the median was 5.


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 own currency.

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Net Income was 67.489 + 23.726 + 8.457 + 11.487 = $111 Mil.
Cash Flow from Operations was -0.854 + 38.713 + 12.57 + 48.648 = $99 Mil.
Revenue was 756.843 + 599.658 + 607.522 + 542.444 = $2,506 Mil.
Gross Profit was 59.843 + 45.44 + 44.367 + 36.834 = $186 Mil.
Total Assets at the begining of this year (Dec12) was $1,501 Mil.
Total Assets was $1,657 Mil.
Long-Term Debt was $10 Mil.
Total Current Assets was $1,343 Mil.
Total Current Liabilities was $398 Mil.
Net Income was 18.115 + 19.314 + 13.58 + 5.598 = $57 Mil.

Revenue was 633.933 + 610.769 + 630.031 + 593.417 = $2,468 Mil.
Gross Profit was 45.459 + 44.78 + 45.991 + 40.508 = $177 Mil.
Total Assets at the begining of last year (Dec11) was $1,500 Mil.
Total Assets was $1,501 Mil.
Long-Term Debt was $10 Mil.
Total Current Assets was $1,214 Mil.
Total Current Liabilities was $331 Mil.

Profitability

Q1. 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.

Benchmark Electronics's current net income was 111. ==> Positive ==> Score 1.

Q2. 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.

Benchmark Electronics's current cash flow from operations was 99. ==> Positive ==> Score 1.

Q3. 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/Total Assets at the beginning of this year (Dec12)
=111.159/1501.477
=0.0740331

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=56.607/1499.998
=0.03773805

Benchmark Electronics's return on assets of this year was 0.0740331. Benchmark Electronics's return on assets of last year was 0.03773805. ==> This year is higher. ==> Score 1.

Q4. 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.

Benchmark Electronics's current net income was 111. Benchmark Electronics's current cash flow from operations was 99. ==> 99 =< 111 ==> CFROA =< ROA ==> Score 0.

Funding

Q5. Change in Gearing or Leverage

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

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

Gearing (This Year)=Long-Term Debt/Total Assets
=9.521/1657.371
=0.00574464

Gearing (Last Year)=Long-Term Debt/Total Assets
=10.103/1501.477
=0.00672871

Benchmark Electronics's gearing of this year was 0.00574464. Benchmark Electronics's gearing of last year was 0.00672871. ==> This year is lower. ==> Score 1.

Q6. 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)=Total Current Assets/Total Current Liabilities
=1342.833/398.377
=3.37075936

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=1214.191/330.515
=3.67363357

Benchmark Electronics's current ratio of this year was 3.37075936. Benchmark Electronics's current ratio of last year was 3.67363357. ==> Last year's current ratio is higher ==> Score 0.

Q7. Change in Shares in Issue

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

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

Benchmark Electronics's number of shares in issue this year was 54.5. Benchmark Electronics's number of shares in issue last year was 55.4. ==> There is the same number of shares in issue this year, or fewer. ==> Score 1.

Efficiency

Q8. 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)=Gross Profit/Revenue
=186.484/2506.467
=0.07440114

Gross Margin (Last Year)=Gross Profit/Revenue
=176.738/2468.15
=0.07160748

Benchmark Electronics's gross margin of this year was 0.07440114. Benchmark Electronics's gross margin of last year was 0.07160748. ==> This year's gross margin is higher. ==> Score 1.

Q9. Change in asset turnover

Compare this year’s asset turnover (total sales 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/Total Assets at the beginning of this year (Dec12)
=2506.467/1501.477
=1.66933426

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=2468.15/1499.998
=1.64543553

Benchmark Electronics's asset turnover of this year was 1.66933426. Benchmark Electronics's asset turnover of last year was 1.64543553. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+1+0+1+0+1+1+1
=7

Good or high score = 8 or 9

Bad or low score = 0 or 1

Benchmark Electronics has an F-score of 7 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 own currency.

Benchmark Electronics Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111011111
Q2 1001111101
Q3 1110011011
Q4 0001110100
Q5 1000011111
Q6 1011111010
Q7 0000111111
Q8 0000011011
Q9 0110001011
F-score 5344488577

Benchmark Electronics Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 1111111111
Q2 1111111111
Q3 0000011111
Q4 0101111110
Q5 1111111111
Q6 0000011100
Q7 1111111111
Q8 0000011111
Q9 0000111101
F-score 4545699977
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