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International Game Technology PLC (NYSE:IGT)
Piotroski F-Score
5 (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

International Game Technology PLC has an F-score of 5 indicating the company's financial situation is typical for a stable company.

IGT' s Piotroski F-Score Range Over the Past 10 Years
Min: 3   Max: 7
Current: 5

3
7

During the past 14 years, the highest Piotroski F-Score of International Game Technology PLC was 7. The lowest was 3. 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 (Dec15) TTM:Last Year (Dec14) TTM:
Net Income was -29.163 + -116.89 + 7.133 + 82.356 = $-57 Mil.
Cash Flow from Operations was 170.78 + 46.305 + 253.909 + 315.003 = $786 Mil.
Revenue was 874.662 + 1290.08 + 1215.313 + 1316.39 = $4,696 Mil.
Gross Profit was 487.005 + 480.181 + 453.962 + 510.635 = $1,932 Mil.
Average Total Assets from the begining of this year (Dec14)
to the end of this year (Dec15) was
(8435.297 + 8283.293 + 16203.289 + 15818.375 + 15114.692) / 5 = $12770.9892 Mil.
Total Assets at the begining of this year (Dec14) was $8,435 Mil.
Long-Term Debt was $8,406 Mil.
Total Current Assets was $2,485 Mil.
Total Current Liabilities was $2,011 Mil.
Net Income was 103.189 + 55.174 + 76.164 + -150.615 = $84 Mil.

Revenue was 1074.478 + 945.318 + 937.917 + 891.805 = $3,850 Mil.
Gross Profit was 586.856 + 304.075 + 318.787 + 296.745 = $1,506 Mil.
Average Total Assets from the begining of last year (Dec13)
to the end of last year (Dec14) was
(7123.374 + 9442.74 + 9403.888 + 9267.38 + 8435.297) / 5 = $8734.5358 Mil.
Total Assets at the begining of last year (Dec13) was $7,123 Mil.
Long-Term Debt was $2,179 Mil.
Total Current Assets was $1,753 Mil.
Total Current Liabilities was $2,989 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.

International Game Technology PLC's current net income (TTM) was -57. ==> Negative ==> Score 0.

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.

International Game Technology PLC's current cash flow from operations (TTM) was 786. ==> 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 (Dec14)
=-56.564/8435.297
=-0.00670563

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Dec13)
=83.912/7123.374
=0.01177981

International Game Technology PLC's return on assets of this year was -0.00670563. International Game Technology PLC's return on assets of last year was 0.01177981. ==> 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.

International Game Technology PLC's current net income (TTM) was -57. International Game Technology PLC's current cash flow from operations (TTM) was 786. ==> 786 > -57 ==> 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: Dec15)=Long-Term Debt/Average Total Assets from Dec14 to Dec15
=8405.561/12770.9892
=0.65817619

Gearing (Last Year: Dec14)=Long-Term Debt/Average Total Assets from Dec13 to Dec14
=2178.766/8734.5358
=0.24944268

International Game Technology PLC's gearing of this year was 0.65817619. International Game Technology PLC's gearing of last year was 0.24944268. ==> 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: Dec15)=Total Current Assets/Total Current Liabilities
=2485.374/2010.626
=1.2361195

Current Ratio (Last Year: Dec14)=Total Current Assets/Total Current Liabilities
=1752.631/2989.483
=0.58626559

International Game Technology PLC's current ratio of this year was 1.2361195. International Game Technology PLC's current ratio of last year was 0.58626559. ==> 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.

International Game Technology PLC's number of shares in issue this year was 192.4. International Game Technology PLC's number of shares in issue last year was 173.7. ==> 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
=1931.783/4696.445
=0.41132878

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=1506.463/3849.518
=0.39133808

International Game Technology PLC's gross margin of this year was 0.41132878. International Game Technology PLC's gross margin of last year was 0.39133808. ==> 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 (Dec14)
=4696.445/8435.297
=0.55676107

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Dec13)
=3849.518/7123.374
=0.54040655

International Game Technology PLC's asset turnover of this year was 0.55676107. International Game Technology PLC's asset turnover of last year was 0.54040655. ==> 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
=0+1+0+1+0+1+0+1+1
=5

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

International Game Technology PLC 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.

International Game Technology PLC Annual Data

Dec11Dec12Dec13Dec14Dec15
Question 1 11110
Question 2 11111
Question 3 11000
Question 4 11111
Question 5 10110
Question 6 01001
Question 7 00000
Question 8 01011
Question 9 11011
F-score 67465

International Game Technology PLC Quarterly Data

Sep13Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15
Question 1 1111110000
Question 2 1111111111
Question 3 1000000000
Question 4 1111111111
Question 5 0100111000
Question 6 1000100111
Question 7 0001101000
Question 8 1000011111
Question 9 1000010111
F-score 7434665555
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