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ArcelorMittal SA (NYSE:MT)
Piotroski F-Score
6 (As of Today)

The zones of discrimination were as such:

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

ArcelorMittal SA has an F-score of 6 indicating the company's financial situation is typical for a stable company.

MT' s 10-Year Piotroski F-Score Range
Min: 2   Max: 9
Current: 6

2
9

During the past 13 years, the highest Piotroski F-Score of ArcelorMittal SA 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 (Jun14) TTM:Last Year (Jun13) TTM:
Net Income was -193 + -1227 + -205 + 52 = $-1,573 Mil.
Cash Flow from Operations was -448 + 2687 + -471 + 1548 = $3,316 Mil.
Revenue was 19643 + 19848 + 19788 + 20704 = $79,983 Mil.
Gross Profit was 18407 + -51827 + 18708 + 19773 = $5,061 Mil.
Average Total Assets from the begining of this year (Jun13)
to the end of this year (Jun14) was
(112633 + 111166 + 112308 + 111348 + 109603) / 5 = $111,412 Mil.
Total Assets was $109,603 Mil.
Long-Term Debt was $18,132 Mil.
Total Current Assets was $31,538 Mil.
Total Current Liabilities was $23,589 Mil.
Net Income was -652 + -3808 + -345 + -780 = $-5,585 Mil.

Revenue was 19723 + 19309 + 19752 + 20197 = $78,981 Mil.
Gross Profit was 18431 + -60573 + 18591 + 19022 = $-4,529 Mil.
Average Total Assets from the begining of last year (Jun12)
to the end of last year (Jun13) was
(118921 + 118631 + 113998 + 115767 + 112633) / 5 = $115,990 Mil.
Total Assets was $112,633 Mil.
Long-Term Debt was $18,943 Mil.
Total Current Assets was $34,713 Mil.
Total Current Liabilities was $24,882 Mil.

Profitability

Q1. Return on Assets (ROA)

Net income before extraordinary items for the year divided by average total assets throughout the year.

Score 1 if positive, 0 if negative.

ArcelorMittal SA's current net income (ttm) was -1,573. ==> Negative ==> Score 0.

Q2. Cash Flow Return on Assets (CFROA)

Net cash flow from operating activities (operating cash flow) divided by average total assets throughout the year.

Score 1 if positive, 0 if negative.

ArcelorMittal SA's current cash flow from operations (ttm) was 3,316. ==> 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)/Average Total Assets from Jun13 to Jun14
=-1573/111411.6
=-0.01411882

ROA (Last Year)=Net Income (TTM)/Average Total Assets from Jun12 to Jun13
=-5585/115990
=-0.0481507

ArcelorMittal SA's return on assets of this year was -0.01411882. ArcelorMittal SA's return on assets of last year was -0.0481507. ==> 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.

ArcelorMittal SA's current net income (ttm) was -1,573. ArcelorMittal SA's current cash flow from operations (ttm) was 3,316. ==> 3,316 > -1,573 ==> CFROA > ROA ==> Score 1.

Funding

Q5. Change in Gearing or Leverage

Compare this year’s gearing (long-term debt divided by total assets) to last year’s gearing.

Score 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year: Jun14)=Long-Term Debt/Total Assets
=18132/109603
=0.16543343

Gearing (Last Year: Jun13)=Long-Term Debt/Total Assets
=18943/112633
=0.16818339

ArcelorMittal SA's gearing of this year was 0.16543343. ArcelorMittal SA's gearing of last year was 0.16818339. ==> 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: Jun14)=Total Current Assets/Total Current Liabilities
=31538/23589
=1.3369791

Current Ratio (Last Year: Jun13)=Total Current Assets/Total Current Liabilities
=34713/24882
=1.3951049

ArcelorMittal SA's current ratio of this year was 1.3369791. ArcelorMittal SA's current ratio of last year was 1.3951049. ==> 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.

ArcelorMittal SA's number of shares in issue this year was 1793. ArcelorMittal SA's number of shares in issue last year was 1789. ==> There is larger 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: TTM)=Gross Profit/Revenue
=5061/79983
=0.06327595

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=-4529/78981
=-0.05734291

ArcelorMittal SA's gross margin of this year was 0.06327595. ArcelorMittal SA's gross margin of last year was -0.05734291. ==> 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 average total assets throughout 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)/Average Total Assets from Jun13 to Jun14
=79983/111411.6
=0.7179055

Asset Turnover (Last Year)=Revenue (TTM)/Average Total Assets from Jun12 to Jun13
=78981/115990
=0.68092939

ArcelorMittal SA's asset turnover of this year was 0.7179055. ArcelorMittal SA's asset turnover of last year was 0.68092939. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=0+1+1+1+1+0+0+1+1
=6

Good or high score = 8 or 9

Bad or low score = 0 or 1

ArcelorMittal SA 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, Altman Z-Score, Beneish M-Score


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

ArcelorMittal SA Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111111100
Q2 1111111111
Q3 1011001001
Q4 0111111011
Q5 1011011011
Q6 1100100101
Q7 1000100010
Q8 1001001101
Q9 1111101100
F-score 8567647546

ArcelorMittal SA Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
Q1 1100000000
Q2 1111111111
Q3 0000000111
Q4 1111111111
Q5 0111111111
Q6 1000011100
Q7 1111000000
Q8 0000000111
Q9 1110000011
F-score 6655344666
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