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DaVita HealthCare Partners Inc (NYSE:DVA)
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

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

DVA' s 10-Year Piotroski F-Score Range
Min: 3   Max: 9
Current: 5

3
9

During the past 13 years, the highest Piotroski F-Score of DaVita HealthCare Partners Inc was 9. 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 (Sep14) TTM:Last Year (Sep13) TTM:
Net Income was 212.278 + 183.289 + 147.683 + 184.122 = $727 Mil.
Cash Flow from Operations was 354.187 + 419.107 + 262.391 + 847.9 = $1,884 Mil.
Revenue was 3063.209 + 3042.776 + 3172.489 + 3251.824 = $12,530 Mil.
Gross Profit was 935.377 + 863.004 + 925.951 + 925.29 = $3,650 Mil.
Average Total Assets from the begining of this year (Sep13)
to the end of this year (Sep14) was
(16827.319 + 17098.877 + 17398.342 + 17925.571 + 18101.416) / 5 = $17470.305 Mil.
Total Assets at the begining of this year (Sep13) was $16,827 Mil.
Long-Term Debt was $8,381 Mil.
Total Current Assets was $4,178 Mil.
Total Current Liabilities was $2,598 Mil.
Net Income was 155.839 + 30.164 + 254.376 + 136.628 = $577 Mil.

Revenue was 2477.853 + 2829.582 + 2871.673 + 2999.586 = $11,179 Mil.
Gross Profit was 770.394 + 868.691 + 857.353 + 904.252 = $3,401 Mil.
Average Total Assets from the begining of last year (Sep12)
to the end of last year (Sep13) was
(10824.112 + 16014.633 + 16413.477 + 16455.509 + 16827.319) / 5 = $15307.01 Mil.
Total Assets at the begining of last year (Sep12) was $10,824 Mil.
Long-Term Debt was $8,181 Mil.
Total Current Assets was $3,381 Mil.
Total Current Liabilities was $2,453 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.

DaVita HealthCare Partners Inc's current net income (TTM) was 727. ==> 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.

DaVita HealthCare Partners Inc's current cash flow from operations (TTM) was 1,884. ==> 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 (Sep13)
=727.372/16827.319
=0.04322566

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=577.007/10824.112
=0.05330756

DaVita HealthCare Partners Inc's return on assets of this year was 0.04322566. DaVita HealthCare Partners Inc's return on assets of last year was 0.05330756. ==> 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.

DaVita HealthCare Partners Inc's current net income (TTM) was 727. DaVita HealthCare Partners Inc's current cash flow from operations (TTM) was 1,884. ==> 1,884 > 727 ==> 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
=8380.903/17470.305
=0.47972276

Gearing (Last Year: Sep13)=Long-Term Debt/Average Total Assets from Sep12 to Sep13
=8181.434/15307.01
=0.53448936

DaVita HealthCare Partners Inc's gearing of this year was 0.47972276. DaVita HealthCare Partners Inc's gearing of last year was 0.53448936. ==> 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
=4178.435/2597.631
=1.60855603

Current Ratio (Last Year: Sep13)=Total Current Assets/Total Current Liabilities
=3381.408/2453.126
=1.37840779

DaVita HealthCare Partners Inc's current ratio of this year was 1.60855603. DaVita HealthCare Partners Inc's current ratio of last year was 1.37840779. ==> 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.

DaVita HealthCare Partners Inc's number of shares in issue this year was 217.2. DaVita HealthCare Partners Inc's number of shares in issue last year was 214.9. ==> 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
=3649.622/12530.298
=0.29126378

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=3400.69/11178.694
=0.30421174

DaVita HealthCare Partners Inc's gross margin of this year was 0.29126378. DaVita HealthCare Partners Inc's gross margin of last year was 0.30421174. ==> 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 (Sep13)
=12530.298/16827.319
=0.74464019

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=11178.694/10824.112
=1.03275853

DaVita HealthCare Partners Inc's asset turnover of this year was 0.74464019. DaVita HealthCare Partners Inc's asset turnover of last year was 1.03275853. ==> 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+1+0+0+0
=5

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

DaVita HealthCare Partners 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.

DaVita HealthCare Partners Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111111111
Q2 1111111111
Q3 1001010110
Q4 1111111111
Q5 1011110101
Q6 1001111000
Q7 1000111100
Q8 0001000110
Q9 1101110110
F-score 8448785864

DaVita HealthCare Partners Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
Q1 1111111111
Q2 1111111111
Q3 1110000100
Q4 1111111111
Q5 1000011111
Q6 0000000111
Q7 1000000000
Q8 1110000000
Q9 1111110000
F-score 8664454655
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