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Chesapeake Lodging Trust (NYSE:CHSP)
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

Chesapeake Lodging Trust has an F-score of 5 indicating the company's financial situation is typical for a stable company.

CHSP' s 10-Year Piotroski F-Score Range
Min: 5   Max: 7
Current: 5

5
7

During the past 4 years, the highest Piotroski F-Score of Chesapeake Lodging Trust was 7. The lowest was 5. 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 (Mar14) TTM:Last Year (Mar13) TTM:
Net Income was 2.178 + 11.528 + 19.243 + 17.057 = $50.0 Mil.
Cash Flow from Operations was 10.367 + 27.566 + 36.543 + 32.165 = $106.6 Mil.
Revenue was 94.774 + 111.563 + 122.443 + 115.57 = $444.4 Mil.
Gross Profit was 22.015 + 34.464 + 42.911 + 42.2 = $141.6 Mil.
Total Assets at the begining of this year (Mar13) was $1,404.6 Mil.
Total Assets was $1,576.5 Mil.
Long-Term Debt was $564.2 Mil.
Total Current Assets was $100.5 Mil.
Total Current Liabilities was $48.3 Mil.
Net Income was -2.51 + 9.887 + 9.033 + 9.053 = $25.5 Mil.

Revenue was 70.601 + 85.1 + 75.86 + 67.046 = $298.6 Mil.
Gross Profit was 15.639 + 26.738 + 27.875 + 25.357 = $95.6 Mil.
Total Assets at the begining of last year (Mar12) was $974.6 Mil.
Total Assets was $1,404.6 Mil.
Long-Term Debt was $421.4 Mil.
Total Current Assets was $160.2 Mil.
Total Current Liabilities was $38.4 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.

Chesapeake Lodging Trust's current net income was 50.0. ==> 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.

Chesapeake Lodging Trust's current cash flow from operations was 106.6. ==> 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 (Mar13)
=50.006/1404.638
=0.03560063

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Mar12)
=25.463/974.586
=0.02612699

Chesapeake Lodging Trust's return on assets of this year was 0.03560063. Chesapeake Lodging Trust's return on assets of last year was 0.02612699. ==> 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.

Chesapeake Lodging Trust's current net income was 50.0. Chesapeake Lodging Trust's current cash flow from operations was 106.6. ==> 106.6 > 50.0 ==> 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
=564.239/1576.487
=0.35790907

Gearing (Last Year)=Long-Term Debt/Total Assets
=421.355/1404.638
=0.29997409

Chesapeake Lodging Trust's gearing of this year was 0.35790907. Chesapeake Lodging Trust's gearing of last year was 0.29997409. ==> Last year is lower than this year ==> Score 0.

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
=100.485/48.307
=2.08013331

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=160.204/38.44
=4.16763788

Chesapeake Lodging Trust's current ratio of this year was 2.08013331. Chesapeake Lodging Trust's current ratio of last year was 4.16763788. ==> 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 0 if there is larger number of shares in issue this year, 1 otherwise.

Chesapeake Lodging Trust's number of shares in issue this year was 49. Chesapeake Lodging Trust's number of shares in issue last year was 44.5. ==> There is larger number of shares in issue this year. ==> Score 0.

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
=141.59/444.35
=0.31864521

Gross Margin (Last Year)=Gross Profit/Revenue
=95.609/298.607
=0.32018338

Chesapeake Lodging Trust's gross margin of this year was 0.31864521. Chesapeake Lodging Trust's gross margin of last year was 0.32018338. ==> 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 (Mar13)
=444.35/1404.638
=0.31634485

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Mar12)
=298.607/974.586
=0.30639369

Chesapeake Lodging Trust's asset turnover of this year was 0.31634485. Chesapeake Lodging Trust's asset turnover of last year was 0.30639369. ==> 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+1+0+0+0+0+1
=5

Good or high score = 8 or 9

Bad or low score = 0 or 1

Chesapeake Lodging Trust has an F-score of 5 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.

Chesapeake Lodging Trust Annual Data

Dec10Dec11Dec12Dec13
Q1
Q2
Q3
Q4
Q5
Q6
Q7
Q8
Q9
F-score

Chesapeake Lodging Trust Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
Q1 1111
Q2 1111
Q3 1111
Q4 1111
Q5 1000
Q6 1000
Q7 0000
Q8 0000
Q9 1111
F-score 0556707555
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