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Helmerich & Payne Inc (NYSE:HP)
Piotroski F-Score
6 (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

Helmerich & Payne Inc has an F-score of 6 indicating the company's financial situation is typical for a stable company.

HP' s Piotroski F-Score Range Over the Past 10 Years
Min: 4   Max: 9
Current: 6

4
9

During the past 13 years, the highest Piotroski F-Score of Helmerich & Payne Inc was 9. 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 own currency.

This Year (Sep15) TTM:Last Year (Sep14) TTM:
Net Income was 203.042 + 149.537 + 90.86 + -21.214 = $422 Mil.
Cash Flow from Operations was 389.692 + 422.892 + 334.955 + 271.205 = $1,419 Mil.
Revenue was 1056.585 + 883.052 + 659.694 + 566.11 = $3,165 Mil.
Gross Profit was 502.342 + 413.724 + 308.024 + 237.188 = $1,461 Mil.
Average Total Assets from the begining of this year (Sep14)
to the end of this year (Sep15) was
(6721.861 + 6801.519 + 7344.15 + 7335.817 + 7152.012) / 5 = $7071.0718 Mil.
Total Assets at the begining of this year (Sep14) was $6,722 Mil.
Long-Term Debt was $492 Mil.
Total Current Assets was $1,439 Mil.
Total Current Liabilities was $351 Mil.
Net Income was 173.182 + 174.57 + 192.279 + 168.688 = $709 Mil.

Revenue was 889.152 + 893.43 + 952.087 + 985.038 = $3,720 Mil.
Gross Profit was 415.104 + 413.263 + 436.848 + 444.58 = $1,710 Mil.
Average Total Assets from the begining of last year (Sep13)
to the end of last year (Sep14) was
(6264.827 + 6410.587 + 6488.281 + 6693.082 + 6721.861) / 5 = $6515.7276 Mil.
Total Assets at the begining of last year (Sep13) was $6,265 Mil.
Long-Term Debt was $40 Mil.
Total Current Assets was $1,277 Mil.
Total Current Liabilities was $508 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.

Helmerich & Payne Inc's current net income (TTM) was 422. ==> 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.

Helmerich & Payne Inc's current cash flow from operations (TTM) was 1,419. ==> 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)
=422.225/6721.861
=0.06281371

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Sep13)
=708.719/6264.827
=0.11312667

Helmerich & Payne Inc's return on assets of this year was 0.06281371. Helmerich & Payne Inc's return on assets of last year was 0.11312667. ==> 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.

Helmerich & Payne Inc's current net income (TTM) was 422. Helmerich & Payne Inc's current cash flow from operations (TTM) was 1,419. ==> 1,419 > 422 ==> 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
=492.443/7071.0718
=0.06964192

Gearing (Last Year: Sep14)=Long-Term Debt/Average Total Assets from Sep13 to Sep14
=40/6515.7276
=0.00613899

Helmerich & Payne Inc's gearing of this year was 0.06964192. Helmerich & Payne Inc's gearing of last year was 0.00613899. ==> 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
=1439.007/351.228
=4.0970737

Current Ratio (Last Year: Sep14)=Total Current Assets/Total Current Liabilities
=1277.366/507.526
=2.5168484

Helmerich & Payne Inc's current ratio of this year was 4.0970737. Helmerich & Payne Inc's current ratio of last year was 2.5168484. ==> This year's current ratio is higher. ==> Score 1.

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.

Helmerich & Payne Inc's number of shares in issue this year was 108.6. Helmerich & Payne Inc's number of shares in issue last year was 109.3. ==> 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
=1461.278/3165.441
=0.46163489

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=1709.795/3719.707
=0.45965852

Helmerich & Payne Inc's gross margin of this year was 0.46163489. Helmerich & Payne Inc's gross margin of last year was 0.45965852. ==> 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)
=3165.441/6721.861
=0.47091735

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Sep13)
=3719.707/6264.827
=0.59374457

Helmerich & Payne Inc's asset turnover of this year was 0.47091735. Helmerich & Payne Inc's asset turnover of last year was 0.59374457. ==> 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
=1+1+0+1+0+1+1+1+0
=6

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

Helmerich & Payne Inc 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.

Helmerich & Payne Inc Annual Data

Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13Sep14Sep15
Question 1 1111111111
Question 2 1111111111
Question 3 1100011100
Question 4 1111111111
Question 5 1011111110
Question 6 0110101101
Question 7 0101001001
Question 8 1100011111
Question 9 1100011010
F-score 7855579766

Helmerich & Payne Inc Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
Question 1 1111111111
Question 2 1111111111
Question 3 1110000000
Question 4 1111111111
Question 5 1111110000
Question 6 1110001111
Question 7 0000001111
Question 8 1111111110
Question 9 0000111000
F-score 7775667665
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