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Computer Sciences Corporation (NYSE:CSC)
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

Computer Sciences Corporation has an F-score of 7 indicating the company's financial situation is typical for a stable company.

CSC' s 10-Year Piotroski F-Score Range
Min: 3   Max: 8
Current: 7

3
8

During the past 13 years, the highest Piotroski F-Score of Computer Sciences Corporation was 8. The lowest was 3. 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 141 + 203 + 156 + 281 = $781 Mil.
Cash Flow from Operations was 529 + 270 + 213 + 41 = $1,053 Mil.
Revenue was 3228 + 3187 + 3260 + 3559 = $13,234 Mil.
Gross Profit was 866 + 849 + 794 + 849 = $3,358 Mil.
Total Assets at the begining of this year (Dec12) was $11,260 Mil.
Total Assets was $11,226 Mil.
Long-Term Debt was $2,184 Mil.
Total Current Assets was $5,408 Mil.
Total Current Liabilities was $3,382 Mil.
Net Income was 510 + 130 + 40 + -158 = $522 Mil.

Revenue was 3781 + 3854 + 3957 + 4114 = $15,706 Mil.
Gross Profit was 786 + 860 + 704 + 593 = $2,943 Mil.
Total Assets at the begining of last year (Dec11) was $11,098 Mil.
Total Assets was $11,260 Mil.
Long-Term Debt was $2,398 Mil.
Total Current Assets was $5,618 Mil.
Total Current Liabilities was $3,287 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.

Computer Sciences Corporation's current net income was 781. ==> 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.

Computer Sciences Corporation's current cash flow from operations was 1,053. ==> 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)
=781/11260
=0.06936057

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=522/11098
=0.0470355

Computer Sciences Corporation's return on assets of this year was 0.06936057. Computer Sciences Corporation's return on assets of last year was 0.0470355. ==> 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.

Computer Sciences Corporation's current net income was 781. Computer Sciences Corporation's current cash flow from operations was 1,053. ==> 1,053 > 781 ==> 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
=2184/11226
=0.19454837

Gearing (Last Year)=Long-Term Debt/Total Assets
=2398/11260
=0.21296625

Computer Sciences Corporation's gearing of this year was 0.19454837. Computer Sciences Corporation's gearing of last year was 0.21296625. ==> This year is lower. ==> 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
=5408/3382
=1.59905381

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=5618/3287
=1.70915729

Computer Sciences Corporation's current ratio of this year was 1.59905381. Computer Sciences Corporation's current ratio of last year was 1.70915729. ==> 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 1 if there is fewer number of shares in issue this year. Score 0 otherwise.

Computer Sciences Corporation's number of shares in issue this year was 149.4. Computer Sciences Corporation's number of shares in issue last year was 156.1. ==> 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
=3358/13234
=0.25374037

Gross Margin (Last Year)=Gross Profit/Revenue
=2943/15706
=0.18738062

Computer Sciences Corporation's gross margin of this year was 0.25374037. Computer Sciences Corporation's gross margin of last year was 0.18738062. ==> 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)
=13234/11260
=1.17531083

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=15706/11098
=1.41520995

Computer Sciences Corporation's asset turnover of this year was 1.17531083. Computer Sciences Corporation's asset turnover of last year was 1.41520995. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+1+1+1+0+1+1+0
=7

Good or high score = 8 or 9

Bad or low score = 0 or 1

Computer Sciences Corporation 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


Historical Data

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

Computer Sciences Corporation Annual Data

Mar04Mar05Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13
Q1 1111111101
Q2 1111111111
Q3 0100110001
Q4 1111111111
Q5 1101001110
Q6 1010011001
Q7 0101110010
Q8 0111010001
Q9 1000100011
F-score 6756675457

Computer Sciences Corporation Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 0000011111
Q2 1111111111
Q3 0000111111
Q4 1111111101
Q5 1011010001
Q6 0000011110
Q7 1111001111
Q8 0000011111
Q9 0110111110
F-score 4454488877
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