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NextEra Energy Inc (NYSE:NEE)
Piotroski F-Score
8 (As of Today)

Good Sign:

Piotroski F-Score of 8 is 8, indicating very healthy situation.

The zones of discrimination were as such:

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

NextEra Energy Inc has an F-score of 8. It is a good or high score, which usually indicates a very healthy situation.

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

3
8

During the past 13 years, the highest Piotroski F-Score of NextEra Energy 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 (Mar14) TTM:Last Year (Mar13) TTM:
Net Income was 430 + 327 + 698 + 610 = $2,065 Mil.
Cash Flow from Operations was 1017 + 1712 + 1140 + 1168 = $5,037 Mil.
Revenue was 3674 + 3630 + 4394 + 3833 = $15,531 Mil.
Gross Profit was 2277 + 2438 + 2956 + 2571 = $10,242 Mil.
Total Assets at the begining of this year (Mar13) was $63,843 Mil.
Total Assets was $70,331 Mil.
Long-Term Debt was $23,824 Mil.
Total Current Assets was $6,141 Mil.
Total Current Liabilities was $10,292 Mil.
Net Income was 272 + 429 + 415 + 607 = $1,723 Mil.

Revenue was 3279 + 3375 + 3843 + 3667 = $14,164 Mil.
Gross Profit was 2214 + 2197 + 2317 + 2431 = $9,159 Mil.
Total Assets at the begining of last year (Mar12) was $59,207 Mil.
Total Assets was $63,843 Mil.
Long-Term Debt was $22,866 Mil.
Total Current Assets was $4,045 Mil.
Total Current Liabilities was $8,776 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.

NextEra Energy Inc's current net income was 2,065. ==> 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.

NextEra Energy Inc's current cash flow from operations was 5,037. ==> 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)
=2065/63843
=0.03234497

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Mar12)
=1723/59207
=0.02910129

NextEra Energy Inc's return on assets of this year was 0.03234497. NextEra Energy Inc's return on assets of last year was 0.02910129. ==> 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.

NextEra Energy Inc's current net income was 2,065. NextEra Energy Inc's current cash flow from operations was 5,037. ==> 5,037 > 2,065 ==> 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 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year)=Long-Term Debt/Total Assets
=23824/70331
=0.3387411

Gearing (Last Year)=Long-Term Debt/Total Assets
=22866/63843
=0.35815986

NextEra Energy Inc's gearing of this year was 0.3387411. NextEra Energy Inc's gearing of last year was 0.35815986. ==> 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
=6141/10292
=0.59667703

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=4045/8776
=0.46091613

NextEra Energy Inc's current ratio of this year was 0.59667703. NextEra Energy Inc's current ratio of last year was 0.46091613. ==> This year's current ratio is higher. ==> Score 1.

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.

NextEra Energy Inc's number of shares in issue this year was 438. NextEra Energy Inc's number of shares in issue last year was 423.7. ==> 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)=Gross Profit/Revenue
=10242/15531
=0.65945528

Gross Margin (Last Year)=Gross Profit/Revenue
=9159/14164
=0.64663937

NextEra Energy Inc's gross margin of this year was 0.65945528. NextEra Energy Inc's gross margin of last year was 0.64663937. ==> This year's gross margin is higher. ==> Score 1.

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)
=15531/63843
=0.24326864

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Mar12)
=14164/59207
=0.23922847

NextEra Energy Inc's asset turnover of this year was 0.24326864. NextEra Energy Inc's asset turnover of last year was 0.23922847. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+1+1+1+1+0+1+1
=8

Good or high score = 8 or 9

Bad or low score = 0 or 1

NextEra Energy Inc has an F-score of 8. It is a good or high score, which usually indicates a very healthy situation.


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.

NextEra Energy Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111111111
Q2 1111111111
Q3 0010101000
Q4 1111111111
Q5 1100000011
Q6 0110101001
Q7 0000000000
Q8 0001111011
Q9 0110000000
F-score 4664646356

NextEra Energy Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
Q1 1111111111
Q2 1111111111
Q3 1110000011
Q4 1111111111
Q5 0001001111
Q6 0000001111
Q7 1100000000
Q8 1111111111
Q9 1000000011
F-score 7655446680
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