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Cencosud SA (NYSE:CNCO)
Piotroski F-Score
6 (As of Today)

The zones of discrimination were as such:

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

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

CNCO' s Piotroski F-Score Range Over the Past 10 Years
Min: 3   Max: 8
Current: 6

3
8

During the past 7 years, the highest Piotroski F-Score of Cencosud SA was 8. 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 local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Net Income was 268.355720381 + 156.605626257 + 123.24922865 + 51.4014527275 = $600 Mil.
Cash Flow from Operations was 589.496292135 + -77.4423901178 + -97.366876903 + 125.734037642 = $540 Mil.
Revenue was 4336.30258 + 3567.71613617 + 3635.40630854 + 3670.10296721 = $15,210 Mil.
Gross Profit was 1280.84904992 + 1033.99088624 + 1064.61594026 + 1043.33516101 = $4,423 Mil.
Average Total Assets from the begining of this year (Sep15)
to the end of this year (Sep16) was
(14819.4205202 + 14380.209515 + 14082.9795432 + 14327.2589213 + 14700.9674783) / 5 = $14462.1671956 Mil.
Total Assets at the begining of this year (Sep15) was $14,819 Mil.
Long-Term Debt was $3,957 Mil.
Total Current Assets was $3,569 Mil.
Total Current Liabilities was $3,614 Mil.
Net Income was 168.65402384 + 36.3794339929 + 83.2584990378 + -43.6632947977 = $245 Mil.

Revenue was 4963.66803319 + 4302.05499027 + 4196.7751764 + 3862.32369942 = $17,325 Mil.
Gross Profit was 1349.99212355 + 1201.01714888 + 1226.56670943 + 1115.77023121 = $4,893 Mil.
Average Total Assets from the begining of last year (Sep14)
to the end of last year (Sep15) was
(17768.385181 + 17643.8197323 + 16886.3060493 + 16244.2529875 + 14819.4205202) / 5 = $16672.4368941 Mil.
Total Assets at the begining of last year (Sep14) was $17,768 Mil.
Long-Term Debt was $4,216 Mil.
Total Current Assets was $3,546 Mil.
Total Current Liabilities was $3,492 Mil.

Profitability

Question 1. 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.

Cencosud SA's current net income (TTM) was 600. ==> Positive ==> Score 1.

Question 2. 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.

Cencosud SA's current cash flow from operations (TTM) was 540. ==> Positive ==> Score 1.

Question 3. 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 (TTM)/Total Assets at the Beginning of This Year (Sep15)
=599.612028016/14819.4205202
=0.04046123

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Sep14)
=244.628662073/17768.385181
=0.01376764

Cencosud SA's return on assets of this year was 0.04046123. Cencosud SA's return on assets of last year was 0.01376764. ==> This year is higher. ==> Score 1.

Question 4. 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.

Cencosud SA's current net income (TTM) was 600. Cencosud SA's current cash flow from operations (TTM) was 540. ==> 540 <= 600 ==> CFROA <= ROA ==> Score 0.

Funding

Question 5. 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: Sep16)=Long-Term Debt/Average Total Assets from Sep15 to Sep16
=3956.9008587/14462.1671956
=0.27360359

Gearing (Last Year: Sep15)=Long-Term Debt/Average Total Assets from Sep14 to Sep15
=4215.76445087/16672.4368941
=0.25285832

Cencosud SA's gearing of this year was 0.27360359. Cencosud SA's gearing of last year was 0.25285832. ==> Last year is lower than this year ==> Score 0.

Question 6. 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: Sep16)=Total Current Assets/Total Current Liabilities
=3568.65227761/3614.42588149
=0.98733586

Current Ratio (Last Year: Sep15)=Total Current Assets/Total Current Liabilities
=3545.60549133/3492.02890173
=1.01534254

Cencosud SA's current ratio of this year was 0.98733586. Cencosud SA's current ratio of last year was 1.01534254. ==> Last year's current ratio is higher ==> Score 0.

Question 7. 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.

Cencosud SA's number of shares in issue this year was 966.5. Cencosud SA's number of shares in issue last year was 942.9. ==> There is larger number of shares in issue this year. ==> Score 0.

Efficiency

Question 8. 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: TTM)=Gross Profit/Revenue
=4422.79103743/15209.5279919
=0.29079081

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=4893.34621307/17324.8218993
=0.28244713

Cencosud SA's gross margin of this year was 0.29079081. Cencosud SA's gross margin of last year was 0.28244713. ==> This year's gross margin is higher. ==> Score 1.

Question 9. Change in asset turnover

Compare this year’s asset turnover (total sales for the year 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 (TTM)/Total Assets at the Beginning of This Year (Sep15)
=15209.5279919/14819.4205202
=1.02632407

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Sep14)
=17324.8218993/17768.385181
=0.97503638

Cencosud SA's asset turnover of this year was 1.02632407. Cencosud SA's asset turnover of last year was 0.97503638. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score= Que. 1+ Que. 2+ Que. 3+Que. 4+Que. 5+Que. 6+Que. 7+Que. 8+Que. 9
=1+1+1+0+0+0+0+1+1
=5

Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Cencosud SA 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 local exchange's currency.

Cencosud SA Annual Data

Dec11Dec12Dec13Dec14Dec15
Question 1 11111
Question 2 11111
Question 3 00001
Question 4 11111
Question 5 11101
Question 6 10011
Question 7 10000
Question 8 00001
Question 9 10000
F-score 74447

Cencosud SA Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
Question 1 111111
Question 2 111111
Question 3 100111
Question 4 111100
Question 5 100100
Question 6 110100
Question 7 001010
Question 8 001111
Question 9 000001
F-score 645755
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