Switch to:
CareFusion Corp (NYSE:CFN)
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

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

CFN' s 10-Year Piotroski F-Score Range
Min: 6   Max: 8
Current: 7

6
8

During the past 7 years, the highest Piotroski F-Score of CareFusion Corp was 8. The lowest was 6. And the median was 7.


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 97 + 78 + 109 + 84 = $368 Mil.
Cash Flow from Operations was 223 + 74 + 188 + 168 = $653 Mil.
Revenue was 922 + 830 + 903 + 901 = $3,556 Mil.
Gross Profit was 466 + 423 + 467 + 476 = $1,832 Mil.
Total Assets at the begining of this year (Dec12) was $8,412 Mil.
Total Assets was $8,631 Mil.
Long-Term Debt was $999 Mil.
Total Current Assets was $2,829 Mil.
Total Current Liabilities was $1,072 Mil.
Net Income was 108 + 84 + 96 + 32 = $320 Mil.

Revenue was 909 + 837 + 961 + 919 = $3,626 Mil.
Gross Profit was 471 + 436 + 475 + 459 = $1,841 Mil.
Total Assets at the begining of last year (Dec11) was $8,363 Mil.
Total Assets was $8,412 Mil.
Long-Term Debt was $1,151 Mil.
Total Current Assets was $3,013 Mil.
Total Current Liabilities was $595 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.

CareFusion Corp's current net income was 368. ==> 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.

CareFusion Corp's current cash flow from operations was 653. ==> 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)
=368/8412
=0.04374703

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=320/8363
=0.03826378

CareFusion Corp's return on assets of this year was 0.04374703. CareFusion Corp's return on assets of last year was 0.03826378. ==> 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.

CareFusion Corp's current net income was 368. CareFusion Corp's current cash flow from operations was 653. ==> 653 > 368 ==> CFROA > ROA ==> Score 1.

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
=999/8631
=0.11574557

Gearing (Last Year)=Long-Term Debt/Total Assets
=1151/8412
=0.13682834

CareFusion Corp's gearing of this year was 0.11574557. CareFusion Corp's gearing of last year was 0.13682834. ==> 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
=2829/1072
=2.63899254

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=3013/595
=5.06386555

CareFusion Corp's current ratio of this year was 2.63899254. CareFusion Corp's current ratio of last year was 5.06386555. ==> 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.

CareFusion Corp's number of shares in issue this year was 213.7. CareFusion Corp's number of shares in issue last year was 224.9. ==> 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
=1832/3556
=0.5151856

Gross Margin (Last Year)=Gross Profit/Revenue
=1841/3626
=0.50772201

CareFusion Corp's gross margin of this year was 0.5151856. CareFusion Corp's gross margin of last year was 0.50772201. ==> 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)
=3556/8412
=0.42272943

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=3626/8363
=0.43357647

CareFusion Corp's asset turnover of this year was 0.42272943. CareFusion Corp's asset turnover of last year was 0.43357647. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

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

Good or high score = 8 or 9

Bad or low score = 0 or 1

CareFusion Corp 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.

CareFusion Corp Annual Data

Jun07Jun08Jun09Jun10Jun11Jun12Jun13
Q1 111
Q2 111
Q3 111
Q4 111
Q5 110
Q6 101
Q7 001
Q8 101
Q9 110
F-score 867

CareFusion Corp Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 1111111111
Q2 1111111111
Q3 1111111111
Q4 1111111111
Q5 1111010011
Q6 0000111100
Q7 0001111111
Q8 1110001111
Q9 0010010000
F-score 6676687777
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Hide