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Amcon Distributing Co (AMEX:DIT)
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

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

DIT' 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 Amcon Distributing Co 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 (Dec14) TTM:Last Year (Dec13) TTM:
Net Income was 0.531 + 1.26 + 1.88 + 1.546 = $5 Mil.
Cash Flow from Operations was 10.441 + 1.177 + 6.448 + -4.912 = $13 Mil.
Revenue was 272.422 + 322.648 + 336.06 + 315.433 = $1,247 Mil.
Gross Profit was 17.62 + 19.295 + 19.951 + 19.527 = $76 Mil.
Average Total Assets from the begining of this year (Dec13)
to the end of this year (Dec14) was
(116.916 + 107.864 + 112.683 + 108.68 + 113.562) / 5 = $111.941 Mil.
Total Assets at the begining of this year (Dec13) was $117 Mil.
Long-Term Debt was $24 Mil.
Total Current Assets was $89 Mil.
Total Current Liabilities was $25 Mil.
Net Income was 1.288 + 1.632 + 1.55 + 1.288 = $6 Mil.

Revenue was 305.626 + 316.031 + 318.235 + 305.626 = $1,246 Mil.
Gross Profit was 19.641 + 19.811 + 20.02 + 19.641 = $79 Mil.
Average Total Assets from the begining of last year (Mar13)
to the end of last year (Dec13) was
(103.433 + 0 + 118.615 + 106.375 + 116.916) / 5 = $89.0678 Mil.
Total Assets at the begining of last year (Mar13) was $103 Mil.
Long-Term Debt was $33 Mil.
Total Current Assets was $92 Mil.
Total Current Liabilities was $25 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.

Amcon Distributing Co's current net income (TTM) was 5. ==> 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.

Amcon Distributing Co's current cash flow from operations (TTM) was 13. ==> 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)/Total Assets at the Beginning of This Year (Dec13)
=5.217/116.916
=0.04462178

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Mar13)
=5.758/103.433
=0.05566889

Amcon Distributing Co's return on assets of this year was 0.04462178. Amcon Distributing Co's return on assets of last year was 0.05566889. ==> Last year is higher ==> Score 0.

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.

Amcon Distributing Co's current net income (TTM) was 5. Amcon Distributing Co's current cash flow from operations (TTM) was 13. ==> 13 > 5 ==> 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: Dec14)=Long-Term Debt/Average Total Assets from Dec13 to Dec14
=24.461/111.941
=0.2185169

Gearing (Last Year: Dec13)=Long-Term Debt/Average Total Assets from Mar13 to Dec13
=32.742/89.0678
=0.3676076

Amcon Distributing Co's gearing of this year was 0.2185169. Amcon Distributing Co's gearing of last year was 0.3676076. ==> This year is lower or equal to last year. ==> 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: Dec14)=Total Current Assets/Total Current Liabilities
=88.901/24.589
=3.61547847

Current Ratio (Last Year: Dec13)=Total Current Assets/Total Current Liabilities
=91.876/24.593
=3.7358598

Amcon Distributing Co's current ratio of this year was 3.61547847. Amcon Distributing Co's current ratio of last year was 3.7358598. ==> 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 0 if there is larger number of shares in issue this year, 1 otherwise.

Amcon Distributing Co's number of shares in issue this year was 0.7. Amcon Distributing Co's number of shares in issue last year was 0.7. ==> 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
=76.393/1246.563
=0.0612829

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=79.113/1245.518
=0.06351815

Amcon Distributing Co's gross margin of this year was 0.0612829. Amcon Distributing Co's gross margin of last year was 0.06351815. ==> 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 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 (Dec13)
=1246.563/116.916
=10.66203941

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Mar13)
=1245.518/103.433
=12.0417855

Amcon Distributing Co's asset turnover of this year was 10.66203941. Amcon Distributing Co's asset turnover of last year was 12.0417855. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

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

Amcon Distributing Co 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.

Amcon Distributing Co Annual Data

Sep05Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14
Q1 0011111111
Q2 1011111111
Q3 0111100000
Q4 1110111101
Q5 0011110111
Q6 1011011111
Q7 1001110011
Q8 1010001000
Q9 0101110011
F-score 5377775567

Amcon Distributing Co Quarterly Data

Dec12Mar13May13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
Q1 11111111
Q2 11010111
Q3 00000000
Q4 01010111
Q5 11010111
Q6 11101010
Q7 11110111
Q8 00000000
Q9 00101010
F-score 5604535575
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