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Monro Muffler Brake, Inc. (NAS:MNRO)
Piotroski F-Score
3 (As of Today)

Warning Sign:

Piotroski F-Score of 3 is low, which usually implies poor business operation.

The zones of discrimination were as such:

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

Monro Muffler Brake, Inc. has an F-score of 3 indicating the company's financial situation is typical for a stable company.

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

3
8

During the past 13 years, the highest Piotroski F-Score of Monro Muffler Brake, Inc. 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 (Dec13) TTM:Last Year (Dec12) TTM:
Net Income was 15.329 + 13.65 + 13.572 + 8.127 = $50.7 Mil.
Cash Flow from Operations was 28.113 + 13.387 + 33.533 + 21.264 = $96.3 Mil.
Revenue was 216.695 + 205.321 + 206.172 + 195.909 = $824.1 Mil.
Gross Profit was 82.324 + 81.748 + 78.878 + 70.574 = $313.5 Mil.
Total Assets at the begining of this year (Dec12) was $669.9 Mil.
Total Assets was $761.4 Mil.
Long-Term Debt was $193.1 Mil.
Total Current Assets was $173.0 Mil.
Total Current Liabilities was $142.5 Mil.
Net Income was 11.255 + 11.548 + 11.637 + 10.502 = $44.9 Mil.

Revenue was 190.437 + 176.475 + 169.175 + 171.745 = $707.8 Mil.
Gross Profit was 69.61 + 69.851 + 68.112 + 66.493 = $274.1 Mil.
Total Assets at the begining of last year (Dec11) was $497.6 Mil.
Total Assets was $669.9 Mil.
Long-Term Debt was $169.6 Mil.
Total Current Assets was $160.5 Mil.
Total Current Liabilities was $122.6 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.

Monro Muffler Brake, Inc.'s current net income was 50.7. ==> 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.

Monro Muffler Brake, Inc.'s current cash flow from operations was 96.3. ==> 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 (Dec12)
=50.678/669.864
=0.07565416

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=44.942/497.624
=0.09031317

Monro Muffler Brake, Inc.'s return on assets of this year was 0.07565416. Monro Muffler Brake, Inc.'s return on assets of last year was 0.09031317. ==> 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.

Monro Muffler Brake, Inc.'s current net income was 50.7. Monro Muffler Brake, Inc.'s current cash flow from operations was 96.3. ==> 96.3 > 50.7 ==> 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 1 if gearing is lower, 0 if it’s higher.

Gearing (This Year)=Long-Term Debt/Total Assets
=193.132/761.399
=0.25365413

Gearing (Last Year)=Long-Term Debt/Total Assets
=169.618/669.864
=0.25321259

Monro Muffler Brake, Inc.'s gearing of this year was 0.25365413. Monro Muffler Brake, Inc.'s gearing of last year was 0.25321259. ==> Last year is lower ==> Score 0.

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
=173.043/142.542
=1.21397904

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=160.511/122.591
=1.30932124

Monro Muffler Brake, Inc.'s current ratio of this year was 1.21397904. Monro Muffler Brake, Inc.'s current ratio of last year was 1.30932124. ==> 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 1 if there is fewer number of shares in issue this year. Score 0 otherwise.

Monro Muffler Brake, Inc.'s number of shares in issue this year was 32.6. Monro Muffler Brake, Inc.'s number of shares in issue last year was 32.2. ==> There is more 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
=313.524/824.097
=0.38044551

Gross Margin (Last Year)=Gross Profit/Revenue
=274.066/707.832
=0.38719075

Monro Muffler Brake, Inc.'s gross margin of this year was 0.38044551. Monro Muffler Brake, Inc.'s gross margin of last year was 0.38719075. ==> 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 (Dec12)
=824.097/669.864
=1.23024524

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=707.832/497.624
=1.42242336

Monro Muffler Brake, Inc.'s asset turnover of this year was 1.23024524. Monro Muffler Brake, Inc.'s asset turnover of last year was 1.42242336. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+0+1+0+0+0+0+0
=3

Good or high score = 8 or 9

Bad or low score = 0 or 1

Monro Muffler Brake, Inc. has an F-score of 3 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.

Monro Muffler Brake, Inc. Annual Data

Mar04Mar05Mar06Mar07Mar08Mar09Mar10Mar11Mar12Mar13
Q1 1111111111
Q2 1111111111
Q3 1010011110
Q4 1111111111
Q5 0110011110
Q6 1010100010
Q7 0000110000
Q8 1000011000
Q9 0001001010
F-score 6464577573

Monro Muffler Brake, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 1111111111
Q2 1111111111
Q3 1110000000
Q4 1111111111
Q5 1110000000
Q6 1010110000
Q7 0000100000
Q8 1100000000
Q9 0010000000
F-score 7673543333
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