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Entergy Corp (NYSE:ETR)
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

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

ETR' s Piotroski F-Score Range Over the Past 10 Years
Min: 4   Max: 7
Current: 4

4
7

During the past 13 years, the highest Piotroski F-Score of Entergy Corp was 7. 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 local exchange's currency.

This Year (Dec16) TTM:Last Year (Dec15) TTM:
Net Income was 235.242 + 572.59 + 393.204 + -1765.538 = $-565 Mil.
Cash Flow from Operations was 532.821 + 719.259 + 1000.315 + 746.304 = $2,999 Mil.
Revenue was 2609.852 + 2462.562 + 3124.703 + 2648.527 = $10,846 Mil.
Gross Profit was 1791.332 + 1791.38 + 2231.931 + 1792.597 = $7,607 Mil.
Average Total Assets from the begining of this year (Dec15)
to the end of this year (Dec16) was
(44647.681 + 45933.882 + 45877.042 + 47738.181 + 45904.434) / 5 = $46020.244 Mil.
Total Assets at the begining of this year (Dec15) was $44,648 Mil.
Long-Term Debt was $14,492 Mil.
Total Current Assets was $3,684 Mil.
Total Current Liabilities was $3,200 Mil.
Net Income was 302.929 + 153.722 + -718.233 + 104.849 = $-157 Mil.

Revenue was 2920.09 + 2713.231 + 3371.406 + 2508.523 = $11,513 Mil.
Gross Profit was 1882.744 + 1773.471 + 2113.596 + 1649.147 = $7,419 Mil.
Average Total Assets from the begining of last year (Dec14)
to the end of last year (Dec15) was
(46414.455 + 46377.533 + 46265.651 + 45041.605 + 44647.681) / 5 = $45749.385 Mil.
Total Assets at the begining of last year (Dec14) was $46,414 Mil.
Long-Term Debt was $13,139 Mil.
Total Current Assets was $4,067 Mil.
Total Current Liabilities was $3,090 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.

Entergy Corp's current net income (TTM) was -565. ==> Negative ==> Score 0.

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.

Entergy Corp's current cash flow from operations (TTM) was 2,999. ==> 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 (Dec15)
=-564.502/44647.681
=-0.01264348

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Dec14)
=-156.733/46414.455
=-0.00337681

Entergy Corp's return on assets of this year was -0.01264348. Entergy Corp's return on assets of last year was -0.00337681. ==> 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.

Entergy Corp's current net income (TTM) was -565. Entergy Corp's current cash flow from operations (TTM) was 2,999. ==> 2,999 > -565 ==> 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: Dec16)=Long-Term Debt/Average Total Assets from Dec15 to Dec16
=14492.237/46020.244
=0.31491004

Gearing (Last Year: Dec15)=Long-Term Debt/Average Total Assets from Dec14 to Dec15
=13138.557/45749.385
=0.28718543

Entergy Corp's gearing of this year was 0.31491004. Entergy Corp's gearing of last year was 0.28718543. ==> 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: Dec16)=Total Current Assets/Total Current Liabilities
=3684.268/3200.096
=1.15129921

Current Ratio (Last Year: Dec15)=Total Current Assets/Total Current Liabilities
=4067.412/3089.958
=1.31633246

Entergy Corp's current ratio of this year was 1.15129921. Entergy Corp's current ratio of last year was 1.31633246. ==> 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.

Entergy Corp's number of shares in issue this year was 178.9. Entergy Corp's number of shares in issue last year was 179.2. ==> 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
=7607.24/10845.644
=0.70140971

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=7418.958/11513.25
=0.64438434

Entergy Corp's gross margin of this year was 0.70140971. Entergy Corp's gross margin of last year was 0.64438434. ==> 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 (Dec15)
=10845.644/44647.681
=0.24291618

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Dec14)
=11513.25/46414.455
=0.24805311

Entergy Corp's asset turnover of this year was 0.24291618. Entergy Corp's asset turnover of last year was 0.24805311. ==> 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
=0+1+0+1+0+0+1+1+0
=4

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

Entergy Corp 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 local exchange's currency.

Entergy Corp Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
Question 1 1111111100
Question 2 1111111111
Question 3 1100100100
Question 4 1111111111
Question 5 0010101100
Question 6 0111011110
Question 7 1111110011
Question 8 1010110011
Question 9 1101001100
F-score 7776766754

Entergy Corp Quarterly Data

Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16
Question 1 1111000110
Question 2 1111111111
Question 3 1100000010
Question 4 1111111111
Question 5 1111000000
Question 6 0110110010
Question 7 0000111101
Question 8 0001111111
Question 9 1100000000
F-score 6755554564
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