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Newell Rubbermaid Inc (NYSE:NWL)
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 = 7, 8, 9
Bad or low score = 0, 1, 2, 3

Newell Rubbermaid Inc has an F-score of 7. It is a good or high score, which usually indicates a very healthy situation.

NWL' s 10-Year Piotroski F-Score Range
Min: 3   Max: 9
Current: 7

3
9

During the past 13 years, the highest Piotroski F-Score of Newell Rubbermaid Inc was 9. 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 (Sep14) TTM:Last Year (Sep13) TTM:
Net Income was 117.3 + 52.9 + 150.6 + 122.3 = $443 Mil.
Cash Flow from Operations was 304.2 + -92.1 + 96.2 + 339.2 = $648 Mil.
Revenue was 1550.8 + 1232.2 + 1521 + 1484.5 = $5,789 Mil.
Gross Profit was 595 + 469.3 + 608.4 + 576.7 = $2,249 Mil.
Average Total Assets from the begining of this year (Sep13)
to the end of this year (Sep14) was
(6152.9 + 6069.7 + 5993.9 + 6218.1 + 6349.2) / 5 = $6156.76 Mil.
Total Assets at the begining of this year (Sep13) was $6,153 Mil.
Long-Term Debt was $1,419 Mil.
Total Current Assets was $2,377 Mil.
Total Current Liabilities was $2,189 Mil.
Net Income was 101.9 + 54.2 + 109.8 + 193.3 = $459 Mil.

Revenue was 1447.2 + 1240.8 + 1474.7 + 1466.1 = $5,629 Mil.
Gross Profit was 536.4 + 473.6 + 582.7 + 552.5 = $2,145 Mil.
Average Total Assets from the begining of last year (Sep12)
to the end of last year (Sep13) was
(6363.3 + 6222 + 6197.2 + 6402.9 + 6152.9) / 5 = $6267.66 Mil.
Total Assets at the begining of last year (Sep12) was $6,363 Mil.
Long-Term Debt was $1,671 Mil.
Total Current Assets was $2,384 Mil.
Total Current Liabilities was $1,443 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.

Newell Rubbermaid Inc's current net income (TTM) was 443. ==> 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.

Newell Rubbermaid Inc's current cash flow from operations (TTM) was 648. ==> 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)/Total Assets at the Beginning of This Year (Sep13)
=443.1/6152.9
=0.07201482

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=459.2/6363.3
=0.07216381

Newell Rubbermaid Inc's return on assets of this year was 0.07201482. Newell Rubbermaid Inc's return on assets of last year was 0.07216381. ==> 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.

Newell Rubbermaid Inc's current net income (TTM) was 443. Newell Rubbermaid Inc's current cash flow from operations (TTM) was 648. ==> 648 > 443 ==> 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: Sep14)=Long-Term Debt/Average Total Assets from Sep13 to Sep14
=1418.7/6156.76
=0.23042964

Gearing (Last Year: Sep13)=Long-Term Debt/Average Total Assets from Sep12 to Sep13
=1671.1/6267.66
=0.26662263

Newell Rubbermaid Inc's gearing of this year was 0.23042964. Newell Rubbermaid Inc's gearing of last year was 0.26662263. ==> 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: Sep14)=Total Current Assets/Total Current Liabilities
=2377.4/2188.7
=1.08621556

Current Ratio (Last Year: Sep13)=Total Current Assets/Total Current Liabilities
=2384.2/1442.8
=1.65248129

Newell Rubbermaid Inc's current ratio of this year was 1.08621556. Newell Rubbermaid Inc's current ratio of last year was 1.65248129. ==> 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.

Newell Rubbermaid Inc's number of shares in issue this year was 276.4. Newell Rubbermaid Inc's number of shares in issue last year was 292.9. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

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
=2249.4/5788.5
=0.38859808

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=2145.2/5628.8
=0.38111143

Newell Rubbermaid Inc's gross margin of this year was 0.38859808. Newell Rubbermaid Inc's gross margin of last year was 0.38111143. ==> 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 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 (Sep13)
=5788.5/6152.9
=0.94077589

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=5628.8/6363.3
=0.88457247

Newell Rubbermaid Inc's asset turnover of this year was 0.94077589. Newell Rubbermaid Inc's asset turnover of last year was 0.88457247. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+0+1+1+0+1+1+1
=7

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

Newell Rubbermaid Inc has an F-score of 7. 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.

Newell Rubbermaid Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 0111011111
Q2 1111111111
Q3 0111011011
Q4 1111111111
Q5 1011010111
Q6 1000111110
Q7 0000100111
Q8 1111011010
Q9 0111001101
F-score 5677477787

Newell Rubbermaid Inc Quarterly Data

Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14Sep14
Q1 1111111111
Q2 1111111111
Q3 0111111110
Q4 1111111111
Q5 1111001011
Q6 0011110100
Q7 1011001111
Q8 1111101111
Q9 0101101111
F-score 6789758887
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