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Nu Skin Enterprises, Inc. (NYSE:NUS)
Piotroski F-Score
7 (As of Today)

Good Sign:

Piotroski F-Score of 7 is 7, 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

Nu Skin Enterprises, Inc. has an F-score of 7 indicating the company's financial situation is typical for a stable company.

NUS' s 10-Year Piotroski F-Score Range
Min: 4   Max: 9
Current: 7

4
9

During the past 13 years, the highest Piotroski F-Score of Nu Skin Enterprises, Inc. was 9. The lowest was 4. And the median was 7.


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 125.271 + 110.9 + 74.435 + 54.282 = $365 Mil.
Cash Flow from Operations was 46.033 + 295.286 + 118.471 + 70.386 = $530 Mil.
Revenue was 1016.085 + 927.612 + 682.927 + 550.094 = $3,177 Mil.
Gross Profit was 851.413 + 787.796 + 571.654 + 460.049 = $2,671 Mil.
Total Assets at the begining of this year (Dec12) was $1,125 Mil.
Total Assets was $1,821 Mil.
Long-Term Debt was $114 Mil.
Total Current Assets was $1,118 Mil.
Total Current Liabilities was $777 Mil.
Net Income was 59.233 + 54.176 + 60.407 + 47.829 = $222 Mil.

Revenue was 550.838 + 526.182 + 593.235 + 462.002 = $2,132 Mil.
Gross Profit was 455.794 + 439.414 + 497.651 + 386.246 = $1,779 Mil.
Total Assets at the begining of last year (Dec11) was $991 Mil.
Total Assets was $1,125 Mil.
Long-Term Debt was $155 Mil.
Total Current Assets was $589 Mil.
Total Current Liabilities was $320 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.

Nu Skin Enterprises, Inc.'s current net income was 365. ==> 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.

Nu Skin Enterprises, Inc.'s current cash flow from operations was 530. ==> 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)
=364.888/1124.807
=0.32440054

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=221.645/990.956
=0.22366785

Nu Skin Enterprises, Inc.'s return on assets of this year was 0.32440054. Nu Skin Enterprises, Inc.'s return on assets of last year was 0.22366785. ==> 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.

Nu Skin Enterprises, Inc.'s current net income was 365. Nu Skin Enterprises, Inc.'s current cash flow from operations was 530. ==> 530 > 365 ==> 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
=113.852/1821.062
=0.06251956

Gearing (Last Year)=Long-Term Debt/Total Assets
=154.963/1124.807
=0.13776852

Nu Skin Enterprises, Inc.'s gearing of this year was 0.06251956. Nu Skin Enterprises, Inc.'s gearing of last year was 0.13776852. ==> This year is lower. ==> 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
=1118.334/776.792
=1.43968269

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=588.603/320.103
=1.83879251

Nu Skin Enterprises, Inc.'s current ratio of this year was 1.43968269. Nu Skin Enterprises, Inc.'s current ratio of last year was 1.83879251. ==> 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.

Nu Skin Enterprises, Inc.'s number of shares in issue this year was 62.1. Nu Skin Enterprises, Inc.'s number of shares in issue last year was 60.9. ==> 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
=2670.912/3176.718
=0.84077718

Gross Margin (Last Year)=Gross Profit/Revenue
=1779.105/2132.257
=0.83437644

Nu Skin Enterprises, Inc.'s gross margin of this year was 0.84077718. Nu Skin Enterprises, Inc.'s gross margin of last year was 0.83437644. ==> 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 (Dec12)
=3176.718/1124.807
=2.82423385

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=2132.257/990.956
=2.15171713

Nu Skin Enterprises, Inc.'s asset turnover of this year was 2.82423385. Nu Skin Enterprises, Inc.'s asset turnover of last year was 2.15171713. ==> 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+0+0+1+1
=7

Good or high score = 8 or 9

Bad or low score = 0 or 1

Nu Skin Enterprises, Inc. has an F-score of 7 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.

Nu Skin Enterprises, Inc. Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111111111
Q2 1111111111
Q3 1001111011
Q4 1111111111
Q5 1100111101
Q6 0100111100
Q7 1111100111
Q8 1000011011
Q9 1101111011
F-score 8746888678

Nu Skin Enterprises, Inc. Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 1111111111
Q2 1111111111
Q3 0011111011
Q4 1111111111
Q5 1110000111
Q6 1110000000
Q7 0000111110
Q8 0011110011
Q9 0011111011
F-score 5586776587
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