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Clorox Company (NYSE:CLX)
Piotroski F-Score
6 (As of Today)

The zones of discrimination were as such:

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

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

CLX' s 10-Year Piotroski F-Score Range
Min: 4   Max: 8
Current: 6

4
8

During the past 13 years, the highest Piotroski F-Score of Clorox Company was 8. 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 own currency.

This Year (Dec13) TTM:Last Year (Dec12) TTM:
Net Income was 115 + 136 + 183 + 133 = $567 Mil.
Cash Flow from Operations was 32 + 178 + 290 + 160 = $660 Mil.
Revenue was 1330 + 1364 + 1547 + 1413 = $5,654 Mil.
Gross Profit was 557 + 585 + 680 + 595 = $2,417 Mil.
Total Assets at the begining of this year (Dec12) was $4,502 Mil.
Total Assets was $4,388 Mil.
Long-Term Debt was $2,170 Mil.
Total Current Assets was $1,500 Mil.
Total Current Liabilities was $1,181 Mil.
Net Income was 123 + 133 + 174 + 132 = $562 Mil.

Revenue was 1325 + 1338 + 1541 + 1401 = $5,605 Mil.
Gross Profit was 563 + 574 + 658 + 593 = $2,388 Mil.
Total Assets at the begining of last year (Dec11) was $4,290 Mil.
Total Assets was $4,502 Mil.
Long-Term Debt was $2,169 Mil.
Total Current Assets was $1,552 Mil.
Total Current Liabilities was $1,373 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.

Clorox Company's current net income was 567. ==> 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.

Clorox Company's current cash flow from operations was 660. ==> 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)
=567/4502
=0.12594402

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=562/4290
=0.13100233

Clorox Company's return on assets of this year was 0.12594402. Clorox Company's return on assets of last year was 0.13100233. ==> 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.

Clorox Company's current net income was 567. Clorox Company's current cash flow from operations was 660. ==> 660 > 567 ==> 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
=2170/4388
=0.49453054

Gearing (Last Year)=Long-Term Debt/Total Assets
=2169/4502
=0.48178587

Clorox Company's gearing of this year was 0.49453054. Clorox Company's gearing of last year was 0.48178587. ==> Last year is lower ==> 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
=1500/1181
=1.27011008

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=1552/1373
=1.13037145

Clorox Company's current ratio of this year was 1.27011008. Clorox Company's current ratio of last year was 1.13037145. ==> 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 1 if there is fewer number of shares in issue this year. Score 0 otherwise.

Clorox Company's number of shares in issue this year was 132.3. Clorox Company's number of shares in issue last year was 132.4. ==> 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
=2417/5654
=0.42748497

Gross Margin (Last Year)=Gross Profit/Revenue
=2388/5605
=0.42604817

Clorox Company's gross margin of this year was 0.42748497. Clorox Company's gross margin of last year was 0.42604817. ==> 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)
=5654/4502
=1.25588627

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=5605/4290
=1.30652681

Clorox Company's asset turnover of this year was 1.25588627. Clorox Company's asset turnover of last year was 1.30652681. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

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

Good or high score = 8 or 9

Bad or low score = 0 or 1

Clorox Company 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.

Clorox Company Annual Data

Jun04Jun05Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13
Q1 1111111111
Q2 1111111111
Q3 1101001011
Q4 1011111111
Q5 1011011010
Q6 1010101101
Q7 1110110110
Q8 0001011001
Q9 1111100110
F-score 8577667676

Clorox Company Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 1111111111
Q2 1111111111
Q3 0111100100
Q4 1111111111
Q5 0111110000
Q6 0000111111
Q7 1111100001
Q8 0000001111
Q9 0111110000
F-score 4777865656
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