Switch to:
Frontline Ltd (NYSE:FRO)
Piotroski F-Score
6 (As of Today)

The zones of discrimination were as such:

Good or high score = 8 or 9
Bad or low score = 0 or 1

Frontline Ltd has an F-score of 6 indicating the company's financial situation is typical for a stable company.

FRO' s 10-Year Piotroski F-Score Range
Min: 2   Max: 9
Current: 6

2
9

During the past 13 years, the highest Piotroski F-Score of Frontline Ltd was 9. The lowest was 2. And the median was 5.


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 -12.085 + -13.031 + -36.446 + -24.346 = $-85.9 Mil.
Cash Flow from Operations was 21.152 + 6.231 + -3.112 + 34.085 = $58.4 Mil.
Revenue was 169.998 + 143.571 + 116.762 + 168.863 = $599.2 Mil.
Gross Profit was 66.245 + 40.18 + 10.414 + 71.024 = $187.9 Mil.
Total Assets at the begining of this year (Mar13) was $1,583.7 Mil.
Total Assets was $1,374.1 Mil.
Long-Term Debt was $1,118.8 Mil.
Total Current Assets was $330.8 Mil.
Total Current Liabilities was $173.8 Mil.
Net Income was -18.755 + -16.566 + -49.017 + -24.346 = $-108.7 Mil.

Revenue was 125.903 + 197.436 + 126.809 + 181.711 = $631.9 Mil.
Gross Profit was 24.903 + 65.312 + 7.376 + 69.205 = $166.8 Mil.
Total Assets at the begining of last year (Mar12) was $1,819.5 Mil.
Total Assets was $1,583.7 Mil.
Long-Term Debt was $1,337.3 Mil.
Total Current Assets was $306.4 Mil.
Total Current Liabilities was $124.3 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.

Frontline Ltd's current net income was -85.9. ==> 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.

Frontline Ltd's current cash flow from operations was 58.4. ==> 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)
=-85.908/1583.665
=-0.05424632

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Mar12)
=-108.684/1819.483
=-0.05973345

Frontline Ltd's return on assets of this year was -0.05424632. Frontline Ltd's return on assets of last year was -0.05973345. ==> 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.

Frontline Ltd's current net income was -85.9. Frontline Ltd's current cash flow from operations was 58.4. ==> 58.4 > -85.9 ==> 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)=Long-Term Debt/Total Assets
=1118.8/1374.081
=0.81421692

Gearing (Last Year)=Long-Term Debt/Total Assets
=1337.344/1583.665
=0.84446142

Frontline Ltd's gearing of this year was 0.81421692. Frontline Ltd's gearing of last year was 0.84446142. ==> This year is lower or equal to last year. ==> Score 1.

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
=330.783/173.755
=1.90373227

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=306.417/124.335
=2.46444686

Frontline Ltd's current ratio of this year was 1.90373227. Frontline Ltd's current ratio of last year was 2.46444686. ==> Last year's current ratio is higher ==> Score 0.

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.

Frontline Ltd's number of shares in issue this year was 92.8. Frontline Ltd's number of shares in issue last year was 77.9. ==> 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)=Gross Profit/Revenue
=187.863/599.194
=0.31352617

Gross Margin (Last Year)=Gross Profit/Revenue
=166.796/631.859
=0.26397662

Frontline Ltd's gross margin of this year was 0.31352617. Frontline Ltd's gross margin of last year was 0.26397662. ==> 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)
=599.194/1583.665
=0.37835906

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Mar12)
=631.859/1819.483
=0.34727392

Frontline Ltd's asset turnover of this year was 0.37835906. Frontline Ltd's asset turnover of last year was 0.34727392. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=0+1+1+1+1+0+0+1+1
=6

Good or high score = 8 or 9

Bad or low score = 0 or 1

Frontline Ltd has an F-score of 6 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.

Frontline Ltd Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111111000
Q2 1111111110
Q3 1001101010
Q4 0110111111
Q5 1010110000
Q6 0000010100
Q7 1010000110
Q8 1000110000
Q9 1000101010
F-score 7353765451

Frontline Ltd Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
Q1 0000000000
Q2 1111111111
Q3 0000111101
Q4 1111111111
Q5 0000000001
Q6 1111000100
Q7 1101110100
Q8 0000000001
Q9 0000111101
F-score 4434554626
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Email Hide