Switch to:
Harley-Davidson Inc (NYSE:HOG)
Piotroski F-Score
8 (As of Today)

Good Sign:

Piotroski F-Score of 8 is 8, indicating very healthy situation.

The zones of discrimination were as such:

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

Harley-Davidson Inc has an F-score of 8. It is a good or high score, which usually indicates a very healthy situation.

HOG' s 10-Year Piotroski F-Score Range
Min: 2   Max: 9
Current: 8

2
9

During the past 13 years, the highest Piotroski F-Score of Harley-Davidson Inc was 9. The lowest was 2. 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 75.409 + 265.917 + 354.153 + 150.066 = $846 Mil.
Cash Flow from Operations was 151.99 + 203.586 + 367.006 + 396.276 = $1,119 Mil.
Revenue was 1190.634 + 1726.048 + 2000.699 + 1301.604 = $6,219 Mil.
Gross Profit was 443.6 + 707.634 + 849.812 + 525.505 = $2,527 Mil.
Average Total Assets from the begining of this year (Sep13)
to the end of this year (Sep14) was
(9484.008 + 9405.04 + 9729.791 + 10076.296 + 10025.506) / 5 = $9744.1282 Mil.
Total Assets at the begining of this year (Sep13) was $9,484 Mil.
Long-Term Debt was $3,573 Mil.
Total Current Assets was $4,202 Mil.
Total Current Liabilities was $2,707 Mil.
Net Income was 70.639 + 224.129 + 271.739 + 162.716 = $729 Mil.

Revenue was 1170.86 + 1571.213 + 1794.307 + 1343.718 = $5,880 Mil.
Gross Profit was 432.128 + 635.853 + 719.205 + 539.805 = $2,327 Mil.
Average Total Assets from the begining of last year (Sep12)
to the end of last year (Sep13) was
(10015.183 + 9170.773 + 9335.121 + 9707.198 + 9484.008) / 5 = $9542.4566 Mil.
Total Assets at the begining of last year (Sep12) was $10,015 Mil.
Long-Term Debt was $4,068 Mil.
Total Current Assets was $4,093 Mil.
Total Current Liabilities was $1,982 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.

Harley-Davidson Inc's current net income (TTM) was 846. ==> 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.

Harley-Davidson Inc's current cash flow from operations (TTM) was 1,119. ==> 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)
=845.545/9484.008
=0.08915482

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=729.223/10015.183
=0.07281175

Harley-Davidson Inc's return on assets of this year was 0.08915482. Harley-Davidson Inc's return on assets of last year was 0.07281175. ==> 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.

Harley-Davidson Inc's current net income (TTM) was 846. Harley-Davidson Inc's current cash flow from operations (TTM) was 1,119. ==> 1,119 > 846 ==> 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
=3573.118/9744.1282
=0.36669448

Gearing (Last Year: Sep13)=Long-Term Debt/Average Total Assets from Sep12 to Sep13
=4067.733/9542.4566
=0.42627734

Harley-Davidson Inc's gearing of this year was 0.36669448. Harley-Davidson Inc's gearing of last year was 0.42627734. ==> 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: Sep14)=Total Current Assets/Total Current Liabilities
=4202.478/2707.044
=1.55242323

Current Ratio (Last Year: Sep13)=Total Current Assets/Total Current Liabilities
=4092.675/1981.716
=2.06521772

Harley-Davidson Inc's current ratio of this year was 1.55242323. Harley-Davidson Inc's current ratio of last year was 2.06521772. ==> 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.

Harley-Davidson Inc's number of shares in issue this year was 216.9. Harley-Davidson Inc's number of shares in issue last year was 223.5. ==> There is smaller number of shares in issue this year, or the same. ==> 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: TTM)=Gross Profit/Revenue
=2526.551/6218.985
=0.40626421

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=2326.991/5880.098
=0.39574017

Harley-Davidson Inc's gross margin of this year was 0.40626421. Harley-Davidson Inc's gross margin of last year was 0.39574017. ==> This year's gross margin is higher. ==> Score 1.

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)
=6218.985/9484.008
=0.65573384

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=5880.098/10015.183
=0.58711838

Harley-Davidson Inc's asset turnover of this year was 0.65573384. Harley-Davidson Inc's asset turnover of last year was 0.58711838. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+1+1+1+0+1+1+1
=8

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

Harley-Davidson Inc has an F-score of 8. It is a good or high score, which usually indicates a very healthy situation.


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.

Harley-Davidson Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111101111
Q2 1111011111
Q3 0010001111
Q4 0100011111
Q5 0010000101
Q6 1100101010
Q7 1111110011
Q8 1110110011
Q9 0010100111
F-score 5673545688

Harley-Davidson Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
Q1 1111111111
Q2 1111111111
Q3 1111011111
Q4 0111111111
Q5 1101001111
Q6 0111110000
Q7 1111111111
Q8 1111111111
Q9 1111111111
F-score 7989788888
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