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EnPro Industries Inc (NYSE:NPO)
Piotroski F-Score
4 (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

EnPro Industries Inc has an F-score of 4 indicating the company's financial situation is typical for a stable company.

NPO' s Piotroski F-Score Range Over the Past 10 Years
Min: 3   Max: 8
Current: 4

3
8

During the past 13 years, the highest Piotroski F-Score of EnPro Industries Inc was 8. 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 (Mar16) TTM:Last Year (Mar15) TTM:
Net Income was -37.3 + 11.4 + 6.6 + -46.8 = $-66 Mil.
Cash Flow from Operations was 19.1 + 34.4 + 54.5 + -28.4 = $80 Mil.
Revenue was 298.4 + 306.6 + 321.9 + 294.9 = $1,222 Mil.
Gross Profit was 101.3 + 101.4 + 103 + 97.6 = $403 Mil.
Average Total Assets from the begining of this year (Mar15)
to the end of this year (Mar16) was
(1519.4 + 1483.3 + 1539.8 + 1503.5 + 1554) / 5 = $1520 Mil.
Total Assets at the begining of this year (Mar15) was $1,519 Mil.
Long-Term Debt was $414 Mil.
Total Current Assets was $531 Mil.
Total Current Liabilities was $522 Mil.
Net Income was 8.3 + 8.6 + 3.8 + -1.6 = $19 Mil.

Revenue was 313.1 + 302.6 + 316.4 + 277.5 = $1,210 Mil.
Gross Profit was 108.1 + 106.2 + 105.9 + 89.8 = $410 Mil.
Average Total Assets from the begining of last year (Mar14)
to the end of last year (Mar15) was
(1428.5 + 1466.2 + 1582.7 + 1602.7 + 1519.4) / 5 = $1519.9 Mil.
Total Assets at the begining of last year (Mar14) was $1,429 Mil.
Long-Term Debt was $611 Mil.
Total Current Assets was $489 Mil.
Total Current Liabilities was $237 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.

EnPro Industries Inc's current net income (TTM) was -66. ==> 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.

EnPro Industries Inc's current cash flow from operations (TTM) was 80. ==> 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 (Mar15)
=-66.1/1519.4
=-0.04350401

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Mar14)
=19.1/1428.5
=0.01337067

EnPro Industries Inc's return on assets of this year was -0.04350401. EnPro Industries Inc's return on assets of last year was 0.01337067. ==> 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.

EnPro Industries Inc's current net income (TTM) was -66. EnPro Industries Inc's current cash flow from operations (TTM) was 80. ==> 80 > -66 ==> 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: Mar16)=Long-Term Debt/Average Total Assets from Mar15 to Mar16
=414.1/1520
=0.27243421

Gearing (Last Year: Mar15)=Long-Term Debt/Average Total Assets from Mar14 to Mar15
=611.1/1519.9
=0.40206593

EnPro Industries Inc's gearing of this year was 0.27243421. EnPro Industries Inc's gearing of last year was 0.40206593. ==> This year is lower or equal to last year. ==> Score 1.

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: Mar16)=Total Current Assets/Total Current Liabilities
=531/522.3
=1.01665709

Current Ratio (Last Year: Mar15)=Total Current Assets/Total Current Liabilities
=488.8/236.6
=2.06593407

EnPro Industries Inc's current ratio of this year was 1.01665709. EnPro Industries Inc's current ratio of last year was 2.06593407. ==> Last year's current ratio is higher ==> Score 0.

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.

EnPro Industries Inc's number of shares in issue this year was 21.8. EnPro Industries Inc's number of shares in issue last year was 23.8. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

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
=403.3/1221.8
=0.33008676

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=410/1209.6
=0.33895503

EnPro Industries Inc's gross margin of this year was 0.33008676. EnPro Industries Inc's gross margin of last year was 0.33895503. ==> Last year's gross margin is higher ==> Score 0.

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 (Mar15)
=1221.8/1519.4
=0.80413321

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Mar14)
=1209.6/1428.5
=0.84676234

EnPro Industries Inc's asset turnover of this year was 0.80413321. EnPro Industries Inc's asset turnover of last year was 0.84676234. ==> Last year's asset turnover is higher ==> Score 0.

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+1+0+1+0+0
=4

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

EnPro Industries Inc has an F-score of 4 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.

EnPro Industries Inc Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
Question 1 0110111110
Question 2 1111111111
Question 3 0110100000
Question 4 1111011111
Question 5 1110000100
Question 6 1001101010
Question 7 1011000001
Question 8 1110100010
Question 9 1100110010
F-score 7774644463

EnPro Industries Inc Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
Question 1 1111110000
Question 2 1111111111
Question 3 0000000000
Question 4 1110111111
Question 5 1100000001
Question 6 0111111000
Question 7 0000011111
Question 8 0100111000
Question 9 0000110000
F-score 4643675334
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