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Campbell Soup Co (NYSE:CPB)
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

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

CPB' s 10-Year Piotroski F-Score Range
Min: 4   Max: 8
Current: 7

4
8

During the past 13 years, the highest Piotroski F-Score of Campbell Soup Co 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 (Oct14) TTM:Last Year (Oct13) TTM:
Net Income was 325 + 184 + 137 + 234 = $880 Mil.
Cash Flow from Operations was 325 + 400 + 136 + 188 = $1,049 Mil.
Revenue was 2281 + 1970 + 1852 + 2255 = $8,358 Mil.
Gross Profit was 814 + 676 + 631 + 783 = $2,904 Mil.
Average Total Assets from the begining of this year (Oct13)
to the end of this year (Oct14) was
(9055 + 8119 + 7964 + 8113 + 8297) / 5 = $8,310 Mil.
Total Assets as of Oct13 was $9,055 Mil.
Long-Term Debt was $2,244 Mil.
Total Current Assets was $2,358 Mil.
Total Current Liabilities was $3,168 Mil.
Net Income was 190 + 181 + -158 + 172 = $385 Mil.

Revenue was 2333 + 2094 + 1289 + 2165 = $7,881 Mil.
Gross Profit was 819 + 748 + 480 + 777 = $2,824 Mil.
Average Total Assets from the begining of last year (Oct12)
to the end of last year (Oct13) was
(8747 + 8593 + 8453 + 8323 + 9055) / 5 = $8,634 Mil.
Total Assets as of Oct12 was $8,747 Mil.
Long-Term Debt was $2,247 Mil.
Total Current Assets was $2,587 Mil.
Total Current Liabilities was $4,104 Mil.

Profitability

Q1. Return on Assets (ROA)

Net income before extraordinary items for the year divided by beginning of the year total assets.

Score 1 if positive, 0 if negative.

Campbell Soup Co's current net income (ttm) was 880. ==> Positive ==> Score 1.

Q2. Cash Flow Return on Assets (CFROA)

Net cash flow from operating activities (operating cash flow) divided by beginning of the year total assets.

Score 1 if positive, 0 if negative.

Campbell Soup Co's current cash flow from operations (ttm) was 1,049. ==> 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 (TTM)/Beginning of This Year Total Assets (Oct13)
=880/9055
=0.09718388

ROA (Last Year)=Net Income (TTM)/Beginning of Last Year Total Assets (Oct12)
=385/8747
=0.04401509

Campbell Soup Co's return on assets of this year was 0.09718388. Campbell Soup Co's return on assets of last year was 0.04401509. ==> 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.

Campbell Soup Co's current net income (ttm) was 880. Campbell Soup Co's current cash flow from operations (ttm) was 1,049. ==> 1,049 > 880 ==> 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: Oct14)=Long-Term Debt/Average Total Assets from Oct13 to Oct14
=2244/8309.6
=0.2700491

Gearing (Last Year: Oct13)=Long-Term Debt/Average Total Assets from Oct12 to Oct13
=2247/8634.2
=0.26024415

Campbell Soup Co's gearing of this year was 0.2700491. Campbell Soup Co's gearing of last year was 0.26024415. ==> 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: Oct14)=Total Current Assets/Total Current Liabilities
=2358/3168
=0.74431818

Current Ratio (Last Year: Oct13)=Total Current Assets/Total Current Liabilities
=2587/4104
=0.63036062

Campbell Soup Co's current ratio of this year was 0.74431818. Campbell Soup Co's current ratio of last year was 0.63036062. ==> 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.

Campbell Soup Co's number of shares in issue this year was 316. Campbell Soup Co's number of shares in issue last year was 317. ==> 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: TTM)=Gross Profit/Revenue
=2904/8358
=0.34745154

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=2824/7881
=0.35833016

Campbell Soup Co's gross margin of this year was 0.34745154. Campbell Soup Co's gross margin of last year was 0.35833016. ==> Last year's gross margin is higher ==> Score 0.

Q9. Change in asset turnover

Compare this year’s asset turnover (total sales for the year divided by begining of the year total assets) 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)/Beginning of This Year Total Assets (Oct13)
=8358/9055
=0.92302595

Asset Turnover (Last Year)=Revenue (TTM)/Beginning of Last Year Total Assets (Oct12)
=7881/8747
=0.90099463

Campbell Soup Co's asset turnover of this year was 0.92302595. Campbell Soup Co's asset turnover of last year was 0.90099463. ==> 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+1+1+0+1
=7

Good or high score = 8 or 9

Bad or low score = 0 or 1

Campbell Soup Co 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, Altman Z-Score, Beneish M-Score


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Campbell Soup Co Annual Data

Jul05Jul06Jul07Jul08Jul09Jul10Jul11Jul12Jul13Jul14
Q1 1111111111
Q2 1111111111
Q3 1101010001
Q4 1100111111
Q5 1101010101
Q6 1010101001
Q7 0011111111
Q8 0110110000
Q9 0001010010
F-score 6656685557

Campbell Soup Co Quarterly Data

Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14
Q1 1111111111
Q2 1111111111
Q3 0001000011
Q4 1111111111
Q5 1000011110
Q6 0000000011
Q7 1111001111
Q8 0000000000
Q9 0111100001
F-score 5556445577
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