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DryShips Inc (NAS:DRYS)
Piotroski F-Score
6 (As of Today)

The zones of discrimination were as such:

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

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

DRYS' s 10-Year Piotroski F-Score Range
Min: 3   Max: 8
Current: 6

3
8

During the past 13 years, the highest Piotroski F-Score of DryShips Inc was 8. 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 (Sep14) TTM:Last Year (Sep13) TTM:
Net Income was -24.369 + -34.551 + -5.634 + 16.67 = $-48 Mil.
Cash Flow from Operations was 192.813 + 35.417 + 162.459 + 68.57 = $459 Mil.
Revenue was 431.352 + 457.486 + 527.673 + 601.954 = $2,018 Mil.
Gross Profit was 236.034 + 248.765 + 284.334 + 346.939 = $1,116 Mil.
Average Total Assets from the begining of this year (Sep13)
to the end of this year (Sep14) was
(9577.349 + 10123.692 + 10713.415 + 10621.015 + 10506.04) / 5 = $10,308 Mil.
Total Assets as of Sep13 was $9,577 Mil.
Long-Term Debt was $4,357 Mil.
Total Current Assets was $1,226 Mil.
Total Current Liabilities was $2,063 Mil.
Net Income was -129.85 + -116.635 + -18.21 + -63.879 = $-329 Mil.

Revenue was 282.866 + 319.713 + 336.008 + 404.941 = $1,344 Mil.
Gross Profit was 76.734 + 149.347 + 168.849 + 224.808 = $620 Mil.
Average Total Assets from the begining of last year (Sep12)
to the end of last year (Sep13) was
(9008.979 + 8878.491 + 9041.311 + 8904.066 + 9577.349) / 5 = $9,082 Mil.
Total Assets as of Sep12 was $9,009 Mil.
Long-Term Debt was $4,153 Mil.
Total Current Assets was $1,069 Mil.
Total Current Liabilities was $1,463 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.

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

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.

DryShips Inc's current cash flow from operations (ttm) was 459. ==> 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 (Sep13)
=-47.884/9577.349
=-0.00499971

ROA (Last Year)=Net Income (TTM)/Beginning of Last Year Total Assets (Sep12)
=-328.574/9008.979
=-0.03647184

DryShips Inc's return on assets of this year was -0.00499971. DryShips Inc's return on assets of last year was -0.03647184. ==> This year is higher. ==> Score 1.

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.

DryShips Inc's current net income (ttm) was -48. DryShips Inc's current cash flow from operations (ttm) was 459. ==> 459 > -48 ==> 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: Sep14)=Long-Term Debt/Average Total Assets from Sep13 to Sep14
=4356.628/10308.3022
=0.42263293

Gearing (Last Year: Sep13)=Long-Term Debt/Average Total Assets from Sep12 to Sep13
=4152.708/9082.0392
=0.45724401

DryShips Inc's gearing of this year was 0.42263293. DryShips Inc's gearing of last year was 0.45724401. ==> 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: Sep14)=Total Current Assets/Total Current Liabilities
=1226.158/2063.197
=0.59430001

Current Ratio (Last Year: Sep13)=Total Current Assets/Total Current Liabilities
=1069.08/1462.931
=0.73077951

DryShips Inc's current ratio of this year was 0.59430001. DryShips Inc's current ratio of last year was 0.73077951. ==> 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.

DryShips Inc's number of shares in issue this year was 413.3. DryShips Inc's number of shares in issue last year was 382.8. ==> There is larger number of shares in issue this year. ==> Score 0.

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
=1116.072/2018.465
=0.55293106

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=619.738/1343.528
=0.46127658

DryShips Inc's gross margin of this year was 0.55293106. DryShips Inc's gross margin of last year was 0.46127658. ==> This year's gross margin is higher. ==> Score 1.

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 (Sep13)
=2018.465/9577.349
=0.21075404

Asset Turnover (Last Year)=Revenue (TTM)/Beginning of Last Year Total Assets (Sep12)
=1343.528/9008.979
=0.1491321

DryShips Inc's asset turnover of this year was 0.21075404. DryShips Inc's asset turnover of last year was 0.1491321. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=0+1+1+1+1+0+0+1+1
=6

Good or high score = 8 or 9

Bad or low score = 0 or 1

DryShips Inc 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, 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.

DryShips Inc Annual Data

Oct04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 111001000
Q2 111111111
Q3 101011001
Q4 110111111
Q5 010110010
Q6 011011000
Q7 000000000
Q8 101001001
Q9 101000101
F-score 656356335

DryShips Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
Q1 0000000000
Q2 1111111111
Q3 0000001111
Q4 1111111111
Q5 1111110001
Q6 0100000100
Q7 0000000000
Q8 0000001111
Q9 1000011111
F-score 4433345656
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