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Brinker International Inc (NYSE:EAT)
Piotroski F-Score
6 (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

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

EAT' s 10-Year Piotroski F-Score Range
Min: 4   Max: 8
Current: 6

4
8

During the past 13 years, the highest Piotroski F-Score of Brinker International Inc was 8. The lowest was 4. 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 (Mar15) TTM:Last Year (Mar14) TTM:
Net Income was 28.82 + 32.738 + 41.306 + 65.427 = $168 Mil.
Cash Flow from Operations was 82.742 + 70.898 + 91.567 + 112.442 = $358 Mil.
Revenue was 755.837 + 711.018 + 742.898 + 784.215 = $2,994 Mil.
Gross Profit was 155.043 + 123.419 + 142.505 + 166.539 = $588 Mil.
Average Total Assets from the begining of this year (Mar14)
to the end of this year (Mar15) was
(1450.078 + 1490.604 + 1476.211 + 1549.831 + 1437.319) / 5 = $1480.8086 Mil.
Total Assets at the begining of this year (Mar14) was $1,450 Mil.
Long-Term Debt was $933 Mil.
Total Current Assets was $190 Mil.
Total Current Liabilities was $407 Mil.
Net Income was 46.367 + 29.212 + 39.744 + 56.263 = $172 Mil.

Revenue was 730.068 + 684.66 + 705.662 + 759.293 = $2,880 Mil.
Gross Profit was 149.312 + 117.596 + 129.42 + 157.505 = $554 Mil.
Average Total Assets from the begining of last year (Mar13)
to the end of last year (Mar14) was
(1445.862 + 1452.603 + 1433.182 + 1489.568 + 1450.078) / 5 = $1454.2586 Mil.
Total Assets at the begining of last year (Mar13) was $1,446 Mil.
Long-Term Debt was $817 Mil.
Total Current Assets was $195 Mil.
Total Current Liabilities was $416 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.

Brinker International Inc's current net income (TTM) was 168. ==> Positive ==> Score 1.

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.

Brinker International Inc's current cash flow from operations (TTM) was 358. ==> 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 (Mar14)
=168.291/1450.078
=0.11605652

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Mar13)
=171.586/1445.862
=0.11867384

Brinker International Inc's return on assets of this year was 0.11605652. Brinker International Inc's return on assets of last year was 0.11867384. ==> Last year is higher ==> Score 0.

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.

Brinker International Inc's current net income (TTM) was 168. Brinker International Inc's current cash flow from operations (TTM) was 358. ==> 358 > 168 ==> 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: Mar15)=Long-Term Debt/Average Total Assets from Mar14 to Mar15
=933.207/1480.8086
=0.63020096

Gearing (Last Year: Mar14)=Long-Term Debt/Average Total Assets from Mar13 to Mar14
=817.259/1454.2586
=0.56197639

Brinker International Inc's gearing of this year was 0.63020096. Brinker International Inc's gearing of last year was 0.56197639. ==> Last year is lower than this year ==> Score 0.

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: Mar15)=Total Current Assets/Total Current Liabilities
=190.046/406.641
=0.46735573

Current Ratio (Last Year: Mar14)=Total Current Assets/Total Current Liabilities
=195.156/416.294
=0.46879369

Brinker International Inc's current ratio of this year was 0.46735573. Brinker International Inc's current ratio of last year was 0.46879369. ==> Last year's current ratio is higher ==> Score 0.

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.

Brinker International Inc's number of shares in issue this year was 64.1. Brinker International Inc's number of shares in issue last year was 68.3. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

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
=587.506/2993.968
=0.19622989

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=553.833/2879.683
=0.19232429

Brinker International Inc's gross margin of this year was 0.19622989. Brinker International Inc's gross margin of last year was 0.19232429. ==> 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 (Mar14)
=2993.968/1450.078
=2.06469445

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Mar13)
=2879.683/1445.862
=1.9916721

Brinker International Inc's asset turnover of this year was 2.06469445. Brinker International Inc's asset turnover of last year was 1.9916721. ==> 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
=1+1+0+1+0+0+1+1+1
=6

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

Brinker International 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


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Brinker International Inc Annual Data

Jun05Jun06Jun07Jun08Jun09Jun10Jun11Jun12Jun13Jun14
Question 1 1111111111
Question 2 1111111111
Question 3 0110111110
Question 4 1111111111
Question 5 1000110000
Question 6 0010110010
Question 7 1111011111
Question 8 0110010111
Question 9 0110001111
F-score 5784686786

Brinker International Inc Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
Question 1 1111111111
Question 2 1111111111
Question 3 1111110000
Question 4 1111111111
Question 5 0000000000
Question 6 1110000000
Question 7 1111111111
Question 8 1111111111
Question 9 1111011111
F-score 8887676666
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