Switch to:
International Game Technology (NYSE:IGT)
Piotroski F-Score
5 (As of Today)

The zones of discrimination were as such:

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

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

IGT' s 10-Year Piotroski F-Score Range
Min: 3   Max: 8
Current: 5

3
8

During the past 13 years, the highest Piotroski F-Score of International Game Technology was 8. 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 25.7 + 79.2 + 63.5 + 65.7 = $234 Mil.
Cash Flow from Operations was -141.3 + 76.1 + 127.4 + 152.7 = $215 Mil.
Revenue was 512.8 + 541.2 + 632.4 + 579 = $2,265 Mil.
Gross Profit was 292.8 + 309.8 + 356.7 + 337.2 = $1,297 Mil.
Total Assets at the begining of this year (Mar13) was $4,200 Mil.
Total Assets was $4,302 Mil.
Long-Term Debt was $1,357 Mil.
Total Current Assets was $1,399 Mil.
Total Current Liabilities was $1,426 Mil.
Net Income was 78.2 + 65.3 + 88.1 + 46.6 = $278 Mil.

Revenue was 600 + 530.3 + 631.1 + 532.8 = $2,294 Mil.
Gross Profit was 341.3 + 309.5 + 369.4 + 302.6 = $1,323 Mil.
Total Assets at the begining of last year (Mar12) was $4,349 Mil.
Total Assets was $4,200 Mil.
Long-Term Debt was $1,829 Mil.
Total Current Assets was $1,288 Mil.
Total Current Liabilities was $624 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.

International Game Technology's current net income was 234. ==> 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.

International Game Technology's current cash flow from operations was 215. ==> 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)
=234.1/4199.7
=0.05574208

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Mar12)
=278.2/4348.5
=0.06397608

International Game Technology's return on assets of this year was 0.05574208. International Game Technology's return on assets of last year was 0.06397608. ==> Last year is higher ==> Score 0.

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.

International Game Technology's current net income was 234. International Game Technology's current cash flow from operations was 215. ==> 215 =< 234 ==> CFROA =< ROA ==> Score 0.

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
=1357.1/4301.5
=0.31549459

Gearing (Last Year)=Long-Term Debt/Total Assets
=1829.3/4199.7
=0.43557873

International Game Technology's gearing of this year was 0.31549459. International Game Technology's gearing of last year was 0.43557873. ==> 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
=1399.2/1426.4
=0.98093102

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=1287.6/623.7
=2.06445406

International Game Technology's current ratio of this year was 0.98093102. International Game Technology's current ratio of last year was 2.06445406. ==> 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.

International Game Technology's number of shares in issue this year was 248.6. International Game Technology's number of shares in issue last year was 265.6. ==> 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)=Gross Profit/Revenue
=1296.5/2265.4
=0.57230511

Gross Margin (Last Year)=Gross Profit/Revenue
=1322.8/2294.2
=0.57658443

International Game Technology's gross margin of this year was 0.57230511. International Game Technology's gross margin of last year was 0.57658443. ==> Last year's gross margin is higher ==> Score 0.

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)
=2265.4/4199.7
=0.53941948

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Mar12)
=2294.2/4348.5
=0.52758422

International Game Technology's asset turnover of this year was 0.53941948. International Game Technology's asset turnover of last year was 0.52758422. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+0+0+1+0+1+0+1
=5

Good or high score = 8 or 9

Bad or low score = 0 or 1

International Game Technology 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 Annual Data

Sep04Sep05Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13
Q1 1111111111
Q2 1111111111
Q3 0011001101
Q4 1111111111
Q5 1110001101
Q6 1001101100
Q7 0111110011
Q8 1011001100
Q9 0111000111
F-score 6688547857

International Game Technology Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
Q1 1111111111
Q2 1111111111
Q3 1100011110
Q4 1111111110
Q5 1100001111
Q6 1000000000
Q7 0111111111
Q8 1000111000
Q9 1111111111
F-score 8755678775
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