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Cyberonics Inc (NAS:CYBX)
Piotroski F-Score
5 (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

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

CYBX' s 10-Year Piotroski F-Score Range
Min: 2   Max: 9
Current: 5

2
9

During the past 13 years, the highest Piotroski F-Score of Cyberonics Inc was 9. The lowest was 2. 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 own currency.

This Year (Jul15) TTM:Last Year (Jul14) TTM:
Net Income was 17.273 + 16.541 + 10.514 + 12.419 = $56.7 Mil.
Cash Flow from Operations was 24.531 + 20.873 + 16.173 + 18.738 = $80.3 Mil.
Revenue was 73.417 + 72.065 + 74.072 + 81.011 = $300.6 Mil.
Gross Profit was 66.651 + 65.525 + 66.477 + 71.578 = $270.2 Mil.
Average Total Assets from the begining of this year (Jul14)
to the end of this year (Jul15) was
(289.923 + 296.748 + 301.387 + 315.944 + 338.227) / 5 = $308.4458 Mil.
Total Assets at the begining of this year (Jul14) was $289.9 Mil.
Long-Term Debt was $0.0 Mil.
Total Current Assets was $263.6 Mil.
Total Current Liabilities was $36.3 Mil.
Net Income was 13.888 + 13.9 + 18.428 + 13.519 = $59.7 Mil.

Revenue was 70.101 + 68.191 + 74.849 + 72.004 = $285.1 Mil.
Gross Profit was 63.175 + 61.731 + 67.425 + 65.594 = $257.9 Mil.
Average Total Assets from the begining of last year (Jul13)
to the end of last year (Jul14) was
(265.799 + 265.683 + 269.182 + 294.191 + 289.923) / 5 = $276.9556 Mil.
Total Assets at the begining of last year (Jul13) was $265.8 Mil.
Long-Term Debt was $0.0 Mil.
Total Current Assets was $215.1 Mil.
Total Current Liabilities was $24.2 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.

Cyberonics Inc's current net income (TTM) was 56.7. ==> 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.

Cyberonics Inc's current cash flow from operations (TTM) was 80.3. ==> 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 (Jul14)
=56.747/289.923
=0.19573128

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Jul13)
=59.735/265.799
=0.22473749

Cyberonics Inc's return on assets of this year was 0.19573128. Cyberonics Inc's return on assets of last year was 0.22473749. ==> 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.

Cyberonics Inc's current net income (TTM) was 56.7. Cyberonics Inc's current cash flow from operations (TTM) was 80.3. ==> 80.3 > 56.7 ==> 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: Jul15)=Long-Term Debt/Average Total Assets from Jul14 to Jul15
=0/308.4458
=0

Gearing (Last Year: Jul14)=Long-Term Debt/Average Total Assets from Jul13 to Jul14
=0/276.9556
=0

Cyberonics Inc's gearing of this year was 0. Cyberonics Inc's gearing of last year was 0. ==> This year is lower or equal to last year. ==> Score 1.

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: Jul15)=Total Current Assets/Total Current Liabilities
=263.615/36.303
=7.26152109

Current Ratio (Last Year: Jul14)=Total Current Assets/Total Current Liabilities
=215.098/24.15
=8.90674948

Cyberonics Inc's current ratio of this year was 7.26152109. Cyberonics Inc's current ratio of last year was 8.90674948. ==> 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.

Cyberonics Inc's number of shares in issue this year was 26.2. Cyberonics Inc's number of shares in issue last year was 26.9. ==> 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
=270.231/300.565
=0.89907674

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=257.925/285.145
=0.9045398

Cyberonics Inc's gross margin of this year was 0.89907674. Cyberonics Inc's gross margin of last year was 0.9045398. ==> Last year's gross margin is higher ==> Score 0.

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 (Jul14)
=300.565/289.923
=1.0367063

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Jul13)
=285.145/265.799
=1.07278432

Cyberonics Inc's asset turnover of this year was 1.0367063. Cyberonics Inc's asset turnover of last year was 1.07278432. ==> 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+1+0+1+0+0
=5

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

Cyberonics Inc 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 own currency.

Cyberonics Inc Annual Data

Apr06Apr07Apr08Apr09Apr10Apr11Apr12Apr13Apr14Apr15
Question 1 0001111111
Question 2 0011111111
Question 3 0111100100
Question 4 0110011101
Question 5 1101111111
Question 6 0010011111
Question 7 0000001111
Question 8 1001111101
Question 9 1011100100
F-score 3356667957

Cyberonics Inc Quarterly Data

Apr13Jul13Oct13Jan14Apr14Jul14Oct14Jan15Apr15Jul15
Question 1 1111111111
Question 2 1111111111
Question 3 1100011100
Question 4 1111011111
Question 5 1111111111
Question 6 1010111110
Question 7 1111111111
Question 8 1000000110
Question 9 1100000000
F-score 9765577875
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