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Chevron Corp (NYSE:CVX)
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

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

CVX' s 10-Year Piotroski F-Score Range
Min: 3   Max: 9
Current: 6

3
9

During the past 13 years, the highest Piotroski F-Score of Chevron Corp was 9. 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 (Jun15) TTM:Last Year (Jun14) TTM:
Net Income was 5593 + 3471 + 2567 + 571 = $12,202 Mil.
Cash Flow from Operations was 8680 + 6497 + 2319 + 7220 = $24,716 Mil.
Revenue was 54679 + 46088 + 34558 + 40357 = $175,682 Mil.
Gross Profit was 23938 + 21825 + 17365 + 13739 = $76,867 Mil.
Average Total Assets from the begining of this year (Jun14)
to the end of this year (Jun15) was
(262045 + 265431 + 266026 + 269604 + 266455) / 5 = $265912.2 Mil.
Total Assets at the begining of this year (Jun14) was $262,045 Mil.
Long-Term Debt was $29,289 Mil.
Total Current Assets was $40,738 Mil.
Total Current Liabilities was $28,268 Mil.
Net Income was 4950 + 4930 + 4512 + 5665 = $20,057 Mil.

Revenue was 58503 + 56158 + 53265 + 57938 = $225,864 Mil.
Gross Profit was 23681 + 23467 + 22442 + 17807 = $87,397 Mil.
Average Total Assets from the begining of last year (Jun13)
to the end of last year (Jun14) was
(244048 + 247838 + 253753 + 258238 + 262045) / 5 = $253184.4 Mil.
Total Assets at the begining of last year (Jun13) was $244,048 Mil.
Long-Term Debt was $20,050 Mil.
Total Current Assets was $48,920 Mil.
Total Current Liabilities was $36,328 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.

Chevron Corp's current net income (TTM) was 12,202. ==> 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.

Chevron Corp's current cash flow from operations (TTM) was 24,716. ==> 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 (Jun14)
=12202/262045
=0.04656452

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Jun13)
=20057/244048
=0.08218465

Chevron Corp's return on assets of this year was 0.04656452. Chevron Corp's return on assets of last year was 0.08218465. ==> Last year is higher ==> Score 0.

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.

Chevron Corp's current net income (TTM) was 12,202. Chevron Corp's current cash flow from operations (TTM) was 24,716. ==> 24,716 > 12,202 ==> CFROA > ROA ==> Score 1.

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: Jun15)=Long-Term Debt/Average Total Assets from Jun14 to Jun15
=29289/265912.2
=0.11014538

Gearing (Last Year: Jun14)=Long-Term Debt/Average Total Assets from Jun13 to Jun14
=20050/253184.4
=0.07919129

Chevron Corp's gearing of this year was 0.11014538. Chevron Corp's gearing of last year was 0.07919129. ==> 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: Jun15)=Total Current Assets/Total Current Liabilities
=40738/28268
=1.44113485

Current Ratio (Last Year: Jun14)=Total Current Assets/Total Current Liabilities
=48920/36328
=1.34661969

Chevron Corp's current ratio of this year was 1.44113485. Chevron Corp's current ratio of last year was 1.34661969. ==> This year's current ratio is higher. ==> Score 1.

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.

Chevron Corp's number of shares in issue this year was 1876.7. Chevron Corp's number of shares in issue last year was 1902.3. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

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
=76867/175682
=0.43753486

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=87397/225864
=0.38694524

Chevron Corp's gross margin of this year was 0.43753486. Chevron Corp's gross margin of last year was 0.38694524. ==> 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 (Jun14)
=175682/262045
=0.67042684

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Jun13)
=225864/244048
=0.92549007

Chevron Corp's asset turnover of this year was 0.67042684. Chevron Corp's asset turnover of last year was 0.92549007. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

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

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

Chevron Corp 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.

Chevron Corp Annual Data

Mar05Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13Mar14
Question 1 1111111111
Question 2 1111111111
Question 3 1101001100
Question 4 1111111111
Question 5 1111011100
Question 6 1000111100
Question 7 1011100111
Question 8 0010110110
Question 9 1101001100
F-score 8667667954

Chevron Corp Quarterly Data

Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15
Question 1 1111111111
Question 2 1111111111
Question 3 0000000000
Question 4 1111111111
Question 5 0000000000
Question 6 0000000011
Question 7 1111111111
Question 8 1110000011
Question 9 0000000000
F-score 5554444466
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