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Fluor Corp (NYSE:FLR)
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 = 8 or 9
Bad or low score = 0 or 1

Fluor Corp has an F-score of 7 indicating the company's financial situation is typical for a stable company.

FLR' s 10-Year Piotroski F-Score Range
Min: 3   Max: 9
Current: 7

3
9

During the past 13 years, the highest Piotroski F-Score of Fluor Corp 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 (Mar14) TTM:Last Year (Mar13) TTM:
Net Income was 149.074 + 166.795 + 173.046 + 161.412 = $650 Mil.
Cash Flow from Operations was 186.714 + 76.256 + 470.321 + 264.053 = $997 Mil.
Revenue was 5384.636 + 6291.405 + 6684.216 + 7190.328 = $25,551 Mil.
Gross Profit was 312.332 + 335.93 + 354.531 + 332.856 = $1,336 Mil.
Total Assets at the begining of this year (Mar13) was $8,463 Mil.
Total Assets was $7,992 Mil.
Long-Term Debt was $497 Mil.
Total Current Assets was $5,615 Mil.
Total Current Liabilities was $3,145 Mil.
Net Income was 166.458 + -4.325 + 144.583 + 161.19 = $468 Mil.

Revenue was 7185.624 + 7022.722 + 7136.056 + 7128.249 = $28,473 Mil.
Gross Profit was 341.874 + -15.642 + 306.275 + 318.466 = $951 Mil.
Total Assets at the begining of last year (Mar12) was $8,521 Mil.
Total Assets was $8,463 Mil.
Long-Term Debt was $496 Mil.
Total Current Assets was $6,261 Mil.
Total Current Liabilities was $3,921 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.

Fluor Corp's current net income was 650. ==> Positive ==> Score 1.

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.

Fluor Corp's current cash flow from operations was 997. ==> 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/Total Assets at the beginning of this year (Mar13)
=650.327/8463.034
=0.07684325

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Mar12)
=467.906/8521.177
=0.05491096

Fluor Corp's return on assets of this year was 0.07684325. Fluor Corp's return on assets of last year was 0.05491096. ==> This year is higher. ==> Score 1.

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.

Fluor Corp's current net income was 650. Fluor Corp's current cash flow from operations was 997. ==> 997 > 650 ==> 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 1 if gearing is lower, 0 if it’s higher.

Gearing (This Year)=Long-Term Debt/Total Assets
=496.715/7991.937
=0.06215202

Gearing (Last Year)=Long-Term Debt/Total Assets
=496.274/8463.034
=0.0586402

Fluor Corp's gearing of this year was 0.06215202. Fluor Corp's gearing of last year was 0.0586402. ==> Last year is lower ==> 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)=Total Current Assets/Total Current Liabilities
=5614.751/3144.763
=1.78542898

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=6260.805/3920.737
=1.59684391

Fluor Corp's current ratio of this year was 1.78542898. Fluor Corp's current ratio of last year was 1.59684391. ==> 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 1 if there is fewer number of shares in issue this year. Score 0 otherwise.

Fluor Corp's number of shares in issue this year was 162.4. Fluor Corp's number of shares in issue last year was 164. ==> There is the same number of shares in issue this year, or fewer. ==> Score 1.

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)=Gross Profit/Revenue
=1335.649/25550.585
=0.05227469

Gross Margin (Last Year)=Gross Profit/Revenue
=950.973/28472.651
=0.03339952

Fluor Corp's gross margin of this year was 0.05227469. Fluor Corp's gross margin of last year was 0.03339952. ==> This year's gross margin is higher. ==> Score 1.

Q9. Change in asset turnover

Compare this year’s asset turnover (total sales 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/Total Assets at the beginning of this year (Mar13)
=25550.585/8463.034
=3.01908098

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Mar12)
=28472.651/8521.177
=3.34139885

Fluor Corp's asset turnover of this year was 3.01908098. Fluor Corp's asset turnover of last year was 3.34139885. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+1+1+0+1+1+1+0
=7

Good or high score = 8 or 9

Bad or low score = 0 or 1

Fluor Corp has an F-score of 7 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.

Fluor Corp Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111111111
Q2 0111111111
Q3 1111100101
Q4 0111111111
Q5 0101111001
Q6 1011111011
Q7 0000010111
Q8 0011110101
Q9 0101100110
F-score 3668875768

Fluor Corp Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
Q1 1111111111
Q2 1111111111
Q3 1111000011
Q4 1001111111
Q5 0001011110
Q6 0111111111
Q7 1111111111
Q8 1111000011
Q9 1111111000
F-score 7779677687
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