Switch to:
Charm Communications Inc (NAS:CHRM)
Piotroski F-Score
5 (As of Today)

The zones of discrimination were as such:

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

Charm Communications Inc has an F-score of 6 indicating the company's financial situation is typical for a stable company.

CHRM' s 10-Year Piotroski F-Score Range
Min: 2   Max: 2
Current: 5

During the past 6 years, the highest Piotroski F-Score of Charm Communications Inc was 2. The lowest was 2. And the median was 2.


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 (Jun13) TTM:Last Year (Jun12) TTM:
Net Income was 0.715 + -1.749 + -5.06 + -0.51 = $-6.6 Mil.
Cash Flow from Operations was 0 + 0 + 0.293 + 0 = $0.3 Mil.
Revenue was 42.851 + 38.111 + 47.132 + 48.844 = $176.9 Mil.
Gross Profit was 15.089 + 9.612 + 13.012 + 14.376 = $52.1 Mil.
Total Assets at the begining of this year (Jun12) was $353.9 Mil.
Total Assets was $320.3 Mil.
Long-Term Debt was $0.0 Mil.
Total Current Assets was $299.9 Mil.
Total Current Liabilities was $103.4 Mil.
Net Income was 0.313 + 0.552 + 0 + 12.683 = $13.5 Mil.

Revenue was 35.981 + 33.541 + 0 + 70.237 = $139.8 Mil.
Gross Profit was 11.127 + 9.84 + 0 + 22.548 = $43.5 Mil.
Total Assets at the begining of last year (Jun11) was $310.6 Mil.
Total Assets was $353.9 Mil.
Long-Term Debt was $0.0 Mil.
Total Current Assets was $337.2 Mil.
Total Current Liabilities was $122.6 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.

Charm Communications Inc's current net income was -6.6. ==> Negative ==> Score 0.

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.

Charm Communications Inc's current cash flow from operations was 0.3. ==> 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 (Jun12)
=-6.604/353.899
=-0.01866069

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Jun11)
=13.548/310.555
=0.04362512

Charm Communications Inc's return on assets of this year was -0.01866069. Charm Communications Inc's return on assets of last year was 0.04362512. ==> Last year is higher ==> Score 0.

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.

Charm Communications Inc's current net income was -6.6. Charm Communications Inc's current cash flow from operations was 0.3. ==> 0.3 > -6.6 ==> 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 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year)=Long-Term Debt/Total Assets
=0/320.279
=0

Gearing (Last Year)=Long-Term Debt/Total Assets
=0/353.899
=0

Charm Communications Inc's gearing of this year was 0. Charm Communications Inc's gearing of last year was 0. ==> This year is lower or equal to last year. ==> 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
=299.891/103.374
=2.90102927

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=337.235/122.644
=2.74970647

Charm Communications Inc's current ratio of this year was 2.90102927. Charm Communications Inc's current ratio of last year was 2.74970647. ==> This year's current ratio is higher. ==> Score 1.

Q7. 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.

Charm Communications Inc's number of shares in issue this year was 40.3. Charm Communications Inc's number of shares in issue last year was 41. ==> There is smaller number of shares in issue this year, or the same. ==> 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
=52.089/176.938
=0.29439126

Gross Margin (Last Year)=Gross Profit/Revenue
=43.515/139.759
=0.31135741

Charm Communications Inc's gross margin of this year was 0.29439126. Charm Communications Inc's gross margin of last year was 0.31135741. ==> Last year's gross margin is higher ==> Score 0.

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 (Jun12)
=176.938/353.899
=0.4999675

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Jun11)
=139.759/310.555
=0.45002979

Charm Communications Inc's asset turnover of this year was 0.4999675. Charm Communications Inc's asset turnover of last year was 0.45002979. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=0+1+0+1+1+1+1+0+1
=6

Good or high score = 8 or 9

Bad or low score = 0 or 1

Charm Communications Inc 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 own currency.

Charm Communications Inc Annual Data

Dec08Dec09Dec10Dec11Dec12Dec13
Q1 01
Q2 11
Q3 01
Q4 11
Q5 11
Q6 10
Q7 10
Q8 01
Q9 01
F-score 57

Charm Communications Inc Quarterly Data

Jun11Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Dec13
Q1 111000
Q2 111111
Q3 000000
Q4 111111
Q5 111111
Q6 001010
Q7 101110
Q8 011001
Q9 000011
F-score 0004462350
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
Email Hide