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DryShips Inc (NAS:DRYS)
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 = 7, 8, 9
Bad or low score = 0, 1, 2, 3

DryShips Inc has an F-score of 7. It is a good or high score, which usually indicates a very healthy situation.

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

3
7

During the past 13 years, the highest Piotroski F-Score of DryShips Inc was 7. The lowest was 3. 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 -34.551 + -5.634 + 16.67 + -23.997 = $-48 Mil.
Cash Flow from Operations was 35.417 + 162.459 + 68.57 + 208.662 = $475 Mil.
Revenue was 457.486 + 527.673 + 601.954 + 598.411 = $2,186 Mil.
Gross Profit was 248.765 + 284.334 + 346.939 + 344.061 = $1,224 Mil.
Average Total Assets from the begining of this year (Dec13)
to the end of this year (Dec14) was
(10123.692 + 10713.415 + 10621.015 + 10506.04 + 10371.603) / 5 = $10467.153 Mil.
Total Assets at the begining of this year (Dec13) was $10,124 Mil.
Long-Term Debt was $4,353 Mil.
Total Current Assets was $1,227 Mil.
Total Current Liabilities was $1,622 Mil.
Net Income was -116.635 + -18.21 + -63.879 + -24.369 = $-223 Mil.

Revenue was 319.713 + 336.008 + 404.941 + 431.352 = $1,492 Mil.
Gross Profit was 149.347 + 168.849 + 224.808 + 236.034 = $779 Mil.
Average Total Assets from the begining of last year (Dec12)
to the end of last year (Dec13) was
(8878.491 + 9041.311 + 8904.066 + 9577.349 + 10123.692) / 5 = $9304.9818 Mil.
Total Assets at the begining of last year (Dec12) was $8,878 Mil.
Long-Term Debt was $3,908 Mil.
Total Current Assets was $1,184 Mil.
Total Current Liabilities was $2,172 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.

DryShips Inc's current net income (TTM) was -48. ==> Negative ==> Score 0.

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.

DryShips Inc's current cash flow from operations (TTM) was 475. ==> 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 (Dec13)
=-47.512/10123.692
=-0.00469315

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Dec12)
=-223.093/8878.491
=-0.02512736

DryShips Inc's return on assets of this year was -0.00469315. DryShips Inc's return on assets of last year was -0.02512736. ==> This year is higher. ==> Score 1.

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.

DryShips Inc's current net income (TTM) was -48. DryShips Inc's current cash flow from operations (TTM) was 475. ==> 475 > -48 ==> 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: Dec14)=Long-Term Debt/Average Total Assets from Dec13 to Dec14
=4352.592/10467.153
=0.41583342

Gearing (Last Year: Dec13)=Long-Term Debt/Average Total Assets from Dec12 to Dec13
=3907.835/9304.9818
=0.41997234

DryShips Inc's gearing of this year was 0.41583342. DryShips Inc's gearing of last year was 0.41997234. ==> 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: Dec14)=Total Current Assets/Total Current Liabilities
=1227.277/1621.76
=0.75675624

Current Ratio (Last Year: Dec13)=Total Current Assets/Total Current Liabilities
=1184.199/2171.714
=0.54528313

DryShips Inc's current ratio of this year was 0.75675624. DryShips Inc's current ratio of last year was 0.54528313. ==> 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.

DryShips Inc's number of shares in issue this year was 588.1. DryShips Inc's number of shares in issue last year was 388.1. ==> There is larger number of shares in issue this year. ==> Score 0.

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
=1224.099/2185.524
=0.56009406

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=779.038/1492.014
=0.52213853

DryShips Inc's gross margin of this year was 0.56009406. DryShips Inc's gross margin of last year was 0.52213853. ==> 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 (Dec13)
=2185.524/10123.692
=0.21588211

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Dec12)
=1492.014/8878.491
=0.16804815

DryShips Inc's asset turnover of this year was 0.21588211. DryShips Inc's asset turnover of last year was 0.16804815. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

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

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

DryShips Inc has an F-score of 7. It is a good or high score, which usually indicates a very healthy situation.


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.

DryShips Inc Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
Question 1 1110010000
Question 2 1111111111
Question 3 1010110011
Question 4 1101111111
Question 5 0101100100
Question 6 0110110001
Question 7 0000000000
Question 8 1010010011
Question 9 1010001011
F-score 6563563356

DryShips Inc Quarterly Data

Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14
Question 1 0000000000
Question 2 1111111111
Question 3 0000011111
Question 4 1111111111
Question 5 1111100011
Question 6 1000001001
Question 7 0000000000
Question 8 0000011111
Question 9 0000111111
F-score 4333456567
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