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Ensco PLC (NYSE:ESV)
Piotroski F-Score
4 (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

Ensco PLC has an F-score of 4 indicating the company's financial situation is typical for a stable company.

ESV' s 10-Year Piotroski F-Score Range
Min: 3   Max: 9
Current: 4

3
9

During the past 13 years, the highest Piotroski F-Score of Ensco PLC 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 361.4 + 292.5 + -1172.7 + 429.4 = $-89 Mil.
Cash Flow from Operations was 630.9 + 416.6 + 572.7 + 596 = $2,216 Mil.
Revenue was 1587 + 1187 + 1203 + 1261.2 = $5,238 Mil.
Gross Profit was 725.8 + 582.6 + 627 + 729.8 = $2,665 Mil.
Average Total Assets from the begining of this year (Sep13)
to the end of this year (Sep14) was
(19142.9 + 19472.9 + 19521.2 + 18271.2 + 19772.5) / 5 = $19236.14 Mil.
Total Assets at the begining of this year (Sep13) was $19,143 Mil.
Long-Term Debt was $5,904 Mil.
Total Current Assets was $3,030 Mil.
Total Current Liabilities was $1,132 Mil.
Net Income was 219.5 + 317.1 + 360.9 + 378.8 = $1,276 Mil.

Revenue was 1085.5 + 1149.9 + 1130.3 + 1162.2 = $4,528 Mil.
Gross Profit was 561 + 589.1 + 603.1 + 627.9 = $2,381 Mil.
Average Total Assets from the begining of last year (Sep12)
to the end of last year (Sep13) was
(18234.3 + 18565.3 + 18592.5 + 18806.6 + 19142.9) / 5 = $18668.32 Mil.
Total Assets at the begining of last year (Sep12) was $18,234 Mil.
Long-Term Debt was $4,744 Mil.
Total Current Assets was $1,517 Mil.
Total Current Liabilities was $941 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.

Ensco PLC's current net income (TTM) was -89. ==> Negative ==> Score 0.

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.

Ensco PLC's current cash flow from operations (TTM) was 2,216. ==> 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)
=-89.4/19142.9
=-0.00467014

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=1276.3/18234.3
=0.06999446

Ensco PLC's return on assets of this year was -0.00467014. Ensco PLC's return on assets of last year was 0.06999446. ==> 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.

Ensco PLC's current net income (TTM) was -89. Ensco PLC's current cash flow from operations (TTM) was 2,216. ==> 2,216 > -89 ==> 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
=5903.9/19236.14
=0.30691708

Gearing (Last Year: Sep13)=Long-Term Debt/Average Total Assets from Sep12 to Sep13
=4743.6/18668.32
=0.25409892

Ensco PLC's gearing of this year was 0.30691708. Ensco PLC's gearing of last year was 0.25409892. ==> Last year is lower than this year ==> Score 0.

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
=3030.4/1131.5
=2.67821476

Current Ratio (Last Year: Sep13)=Total Current Assets/Total Current Liabilities
=1517.1/940.5
=1.61307815

Ensco PLC's current ratio of this year was 2.67821476. Ensco PLC's current ratio of last year was 1.61307815. ==> 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.

Ensco PLC's number of shares in issue this year was 232. Ensco PLC's number of shares in issue last year was 231.3. ==> 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
=2665.2/5238.2
=0.50880073

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=2381.1/4527.9
=0.52587292

Ensco PLC's gross margin of this year was 0.50880073. Ensco PLC's gross margin of last year was 0.52587292. ==> 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)
=5238.2/19142.9
=0.2736367

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=4527.9/18234.3
=0.24831773

Ensco PLC's asset turnover of this year was 0.2736367. Ensco PLC's asset turnover of last year was 0.24831773. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=0+1+0+1+0+1+0+0+1
=4

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

Ensco PLC has an F-score of 4 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.

Ensco PLC Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111111111
Q2 1111111111
Q3 0111100001
Q4 1111111111
Q5 1111111011
Q6 0110111010
Q7 0001110000
Q8 1110100010
Q9 0110000101
F-score 5886865466

Ensco PLC Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
Q1 1111111100
Q2 1111111111
Q3 0000111100
Q4 1111111111
Q5 1111111110
Q6 0111110001
Q7 0000000000
Q8 0111110000
Q9 0000111111
F-score 4666886644
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