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Forest City Realty Trust Inc (NYSE:FCE.A)
Piotroski F-Score
0 (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

Forest City Realty Trust Inc has an F-score of 5 indicating the company's financial situation is typical for a stable company.


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 (Sep15) TTM:Last Year (Sep14) TTM:
Net Income was 69.191 + -54.209 + 303.756 + -302.219 = $17 Mil.
Cash Flow from Operations was 100.793 + 12.992 + 75.401 + 70.157 = $259 Mil.
Revenue was 252.135 + 237.082 + 259.759 + 289.057 = $1,038 Mil.
Gross Profit was 100.639 + 96.154 + 114.891 + 135.554 = $447 Mil.
Average Total Assets from the begining of this year (Sep14)
to the end of this year (Sep15) was
(8208.93 + 8814.94 + 8795.391 + 10328.303 + 9960.241) / 5 = $9221.561 Mil.
Total Assets at the begining of this year (Sep14) was $8,209 Mil.
Long-Term Debt was $4,773 Mil.
Total Current Assets was $1,017 Mil.
Total Current Liabilities was $1,600 Mil.
Net Income was 153.329 + 15.52 + -92.992 + 0.686 = $77 Mil.

Revenue was 266.227 + 249.537 + 229.637 + 234.743 = $980 Mil.
Gross Profit was 55.972 + 89.995 + 93.889 + 98.352 = $338 Mil.
Average Total Assets from the begining of last year (Jul13)
to the end of last year (Sep14) was
(10728.101 + 9329.905 + 8946.808 + 8551.521 + 8208.93) / 5 = $9153.053 Mil.
Total Assets at the begining of last year (Jul13) was $10,728 Mil.
Long-Term Debt was $4,716 Mil.
Total Current Assets was $866 Mil.
Total Current Liabilities was $1,250 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.

Forest City Realty Trust Inc's current net income (TTM) was 17. ==> 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.

Forest City Realty Trust Inc's current cash flow from operations (TTM) was 259. ==> 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 (Sep14)
=16.519/8208.93
=0.00201232

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Jul13)
=76.543/10728.101
=0.00713481

Forest City Realty Trust Inc's return on assets of this year was 0.00201232. Forest City Realty Trust Inc's return on assets of last year was 0.00713481. ==> 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.

Forest City Realty Trust Inc's current net income (TTM) was 17. Forest City Realty Trust Inc's current cash flow from operations (TTM) was 259. ==> 259 > 17 ==> 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: Sep15)=Long-Term Debt/Average Total Assets from Sep14 to Sep15
=4773.418/9221.561
=0.51763666

Gearing (Last Year: Sep14)=Long-Term Debt/Average Total Assets from Jul13 to Sep14
=4716.396/9153.053
=0.51528119

Forest City Realty Trust Inc's gearing of this year was 0.51763666. Forest City Realty Trust Inc's gearing of last year was 0.51528119. ==> 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: Sep15)=Total Current Assets/Total Current Liabilities
=1017.147/1600.335
=0.6355838

Current Ratio (Last Year: Sep14)=Total Current Assets/Total Current Liabilities
=865.671/1250.018
=0.69252683

Forest City Realty Trust Inc's current ratio of this year was 0.6355838. Forest City Realty Trust Inc's current ratio of last year was 0.69252683. ==> 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.

Forest City Realty Trust Inc's number of shares in issue this year was 255.4. Forest City Realty Trust Inc's number of shares in issue last year was 199.6. ==> There is larger number of shares in issue this year. ==> Score 0.

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
=447.238/1038.033
=0.43085143

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=338.208/980.144
=0.3450595

Forest City Realty Trust Inc's gross margin of this year was 0.43085143. Forest City Realty Trust Inc's gross margin of last year was 0.3450595. ==> 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 (Sep14)
=1038.033/8208.93
=0.12645168

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Jul13)
=980.144/10728.101
=0.0913623

Forest City Realty Trust Inc's asset turnover of this year was 0.12645168. Forest City Realty Trust Inc's asset turnover of last year was 0.0913623. ==> 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+0+1+1
=5

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

Forest City Realty Trust 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.

Forest City Realty Trust Inc Annual Data

Jan05Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Dec14
Question 1 1111001010
Question 2 1111111111
Question 3 1010011010
Question 4 1111111111
Question 5 0110011101
Question 6 0001011001
Question 7 1001100101
Question 8 0001110011
Question 9 1001000010
F-score 6457466466

Forest City Realty Trust Inc Quarterly Data

Apr13Jul13Oct13Mar14Jun14Sep14Dec14Mar15Jun15Sep15
Question 1 11111011
Question 2 11111111
Question 3 11111010
Question 4 11111101
Question 5 00011100
Question 6 11110100
Question 7 00010100
Question 8 11000111
Question 9 11100011
F-score 77675655
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