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EMCOR Group, Inc. (NYSE:EME)
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

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

EME' s 10-Year Piotroski F-Score Range
Min: 3   Max: 8
Current: 7

3
8

During the past 13 years, the highest Piotroski F-Score of EMCOR Group, 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 (Mar15) TTM:Last Year (Mar14) TTM:
Net Income was 39.913 + 45.024 + 42.466 + 32.849 = $160 Mil.
Cash Flow from Operations was 63.956 + 69.354 + 137.663 + -17.821 = $253 Mil.
Revenue was 1558.055 + 1566.711 + 1714.796 + 1589.187 = $6,429 Mil.
Gross Profit was 219.635 + 222.229 + 248.573 + 216.929 = $907 Mil.
Average Total Assets from the begining of this year (Mar14)
to the end of this year (Mar15) was
(3407.516 + 3404.895 + 3434.667 + 3388.967 + 3315.582) / 5 = $3390.3254 Mil.
Total Assets at the begining of this year (Mar14) was $3,408 Mil.
Long-Term Debt was $311 Mil.
Total Current Assets was $1,827 Mil.
Total Current Liabilities was $1,213 Mil.
Net Income was 21.014 + 26.69 + 45.921 + 41.261 = $135 Mil.

Revenue was 1556.753 + 1605.315 + 1649.279 + 1590.539 = $6,402 Mil.
Gross Profit was 181.535 + 206.562 + 236.871 + 216.203 = $841 Mil.
Average Total Assets from the begining of last year (Mar13)
to the end of last year (Mar14) was
(3014.716 + 3105.336 + 3506.759 + 3465.915 + 3407.516) / 5 = $3300.0484 Mil.
Total Assets at the begining of last year (Mar13) was $3,015 Mil.
Long-Term Debt was $331 Mil.
Total Current Assets was $1,881 Mil.
Total Current Liabilities was $1,202 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.

EMCOR Group, Inc.'s current net income (TTM) was 160. ==> 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.

EMCOR Group, Inc.'s current cash flow from operations (TTM) was 253. ==> 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)
=160.252/3407.516
=0.04702898

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Mar13)
=134.886/3014.716
=0.04474252

EMCOR Group, Inc.'s return on assets of this year was 0.04702898. EMCOR Group, Inc.'s return on assets of last year was 0.04474252. ==> 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.

EMCOR Group, Inc.'s current net income (TTM) was 160. EMCOR Group, Inc.'s current cash flow from operations (TTM) was 253. ==> 253 > 160 ==> 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
=311.302/3390.3254
=0.09182068

Gearing (Last Year: Mar14)=Long-Term Debt/Average Total Assets from Mar13 to Mar14
=330.639/3300.0484
=0.10019217

EMCOR Group, Inc.'s gearing of this year was 0.09182068. EMCOR Group, Inc.'s gearing of last year was 0.10019217. ==> 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: Mar15)=Total Current Assets/Total Current Liabilities
=1827.293/1212.878
=1.50657609

Current Ratio (Last Year: Mar14)=Total Current Assets/Total Current Liabilities
=1881.18/1202.414
=1.56450274

EMCOR Group, Inc.'s current ratio of this year was 1.50657609. EMCOR Group, Inc.'s current ratio of last year was 1.56450274. ==> 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.

EMCOR Group, Inc.'s number of shares in issue this year was 63.6. EMCOR Group, Inc.'s number of shares in issue last year was 68. ==> 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
=907.366/6428.749
=0.14114192

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=841.171/6401.886
=0.13139425

EMCOR Group, Inc.'s gross margin of this year was 0.14114192. EMCOR Group, Inc.'s gross margin of last year was 0.13139425. ==> 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)
=6428.749/3407.516
=1.88663795

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Mar13)
=6401.886/3014.716
=2.1235453

EMCOR Group, Inc.'s asset turnover of this year was 1.88663795. EMCOR Group, Inc.'s asset turnover of last year was 2.1235453. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

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

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

EMCOR Group, 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.

EMCOR Group, Inc. Annual Data

Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14
Question 1 1111101111
Question 2 1111111111
Question 3 1111001101
Question 4 1111111111
Question 5 0101010101
Question 6 1101110100
Question 7 0000010101
Question 8 1111100011
Question 9 0110001100
F-score 6867555847

EMCOR Group, Inc. Quarterly Data

Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14Dec14Mar15
Question 1 1111111111
Question 2 1111111111
Question 3 1100001111
Question 4 1011111111
Question 5 1110000111
Question 6 1110000100
Question 7 1000011111
Question 8 0001111111
Question 9 1110000000
F-score 8664456877
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