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Dick's Sporting Goods Inc (NYSE:DKS)
Piotroski F-Score
5 (As of Today)

The zones of discrimination were as such:

Good or high score = 8 or 9
Bad or low score = 0 or 1

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

DKS' s 10-Year Piotroski F-Score Range
Min: 3   Max: 8
Current: 5

3
8

During the past 13 years, the highest Piotroski F-Score of Dick's Sporting Goods Inc 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 (Oct14) TTM:Last Year (Oct13) TTM:
Net Income was 138.637 + 69.984 + 69.467 + 49.211 = $327 Mil.
Cash Flow from Operations was 461.573 + 13.924 + 138.295 + -49.462 = $564 Mil.
Revenue was 1947.418 + 1438.908 + 1688.89 + 1526.675 = $6,602 Mil.
Gross Profit was 628.067 + 440.883 + 502.556 + 451.972 = $2,023 Mil.
Average Total Assets from the begining of this year (Oct13)
to the end of this year (Oct14) was
(3347.895 + 3071.487 + 3269.437 + 3255.483 + 3655.532) / 5 = $3,320 Mil.
Total Assets as of Oct13 was $3,348 Mil.
Long-Term Debt was $287 Mil.
Total Current Assets was $2,076 Mil.
Total Current Liabilities was $1,259 Mil.
Net Income was 129.75 + 64.821 + 84.163 + 49.977 = $329 Mil.

Revenue was 1805.301 + 1333.701 + 1531.431 + 1400.623 = $6,071 Mil.
Gross Profit was 588.651 + 411.654 + 479.33 + 424.899 = $1,905 Mil.
Average Total Assets from the begining of last year (Oct12)
to the end of last year (Oct13) was
(3069.581 + 2887.807 + 2937.875 + 3019.471 + 3347.895) / 5 = $3,053 Mil.
Total Assets as of Oct12 was $3,070 Mil.
Long-Term Debt was $123 Mil.
Total Current Assets was $1,905 Mil.
Total Current Liabilities was $1,169 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.

Dick's Sporting Goods Inc's current net income (ttm) was 327. ==> 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.

Dick's Sporting Goods Inc's current cash flow from operations (ttm) was 564. ==> 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)
=327.299/3347.895
=0.09776262

ROA (Last Year)=Net Income (TTM)/Beginning of Last Year Total Assets (Oct12)
=328.711/3069.581
=0.1070866

Dick's Sporting Goods Inc's return on assets of this year was 0.09776262. Dick's Sporting Goods Inc's return on assets of last year was 0.1070866. ==> 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.

Dick's Sporting Goods Inc's current net income (ttm) was 327. Dick's Sporting Goods Inc's current cash flow from operations (ttm) was 564. ==> 564 > 327 ==> 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
=286.608/3319.9668
=0.08632857

Gearing (Last Year: Oct13)=Long-Term Debt/Average Total Assets from Oct12 to Oct13
=122.996/3052.5258
=0.04029319

Dick's Sporting Goods Inc's gearing of this year was 0.08632857. Dick's Sporting Goods Inc's gearing of last year was 0.04029319. ==> 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
=2075.865/1258.779
=1.64910997

Current Ratio (Last Year: Oct13)=Total Current Assets/Total Current Liabilities
=1904.925/1169.004
=1.62952821

Dick's Sporting Goods Inc's current ratio of this year was 1.64910997. Dick's Sporting Goods Inc's current ratio of last year was 1.62952821. ==> 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.

Dick's Sporting Goods Inc's number of shares in issue this year was 120. Dick's Sporting Goods Inc's number of shares in issue last year was 125.8. ==> 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
=2023.478/6601.891
=0.30649976

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=1904.534/6071.056
=0.3137072

Dick's Sporting Goods Inc's gross margin of this year was 0.30649976. Dick's Sporting Goods Inc's gross margin of last year was 0.3137072. ==> 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)
=6601.891/3347.895
=1.97195282

Asset Turnover (Last Year)=Revenue (TTM)/Beginning of Last Year Total Assets (Oct12)
=6071.056/3069.581
=1.97781261

Dick's Sporting Goods Inc's asset turnover of this year was 1.97195282. Dick's Sporting Goods Inc's asset turnover of last year was 1.97781261. ==> 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+0+1+1+0+0
=5

Good or high score = 8 or 9

Bad or low score = 0 or 1

Dick's Sporting Goods 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, 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.

Dick's Sporting Goods Inc Annual Data

Jan05Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14
Q1 1111011111
Q2 1111111111
Q3 0011011101
Q4 1111111111
Q5 0111111111
Q6 0010101101
Q7 0000100001
Q8 1111001110
Q9 1010010001
F-score 5586567758

Dick's Sporting Goods Inc Quarterly Data

Jul12Oct12Jan13Apr13Jul13Oct13Jan14Apr14Jul14Oct14
Q1 1111111111
Q2 1111111111
Q3 1000111100
Q4 1111101111
Q5 1111101110
Q6 0000001101
Q7 1001011111
Q8 1111110000
Q9 0000111110
F-score 7556768865
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