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OneBeacon Insurance Group Ltd (NYSE:OB)
Piotroski F-Score
4 (As of Today)

The zones of discrimination were as such:

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

OneBeacon Insurance Group Ltd has an F-score of 4 indicating the company's financial situation is typical for a stable company.

OB' s 10-Year Piotroski F-Score Range
Min: 1   Max: 7
Current: 4

1
7

During the past 13 years, the highest Piotroski F-Score of OneBeacon Insurance Group Ltd was 7. The lowest was 1. And the median was 3.


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 47 + 41.4 + 39.1 + -2.9 = $125 Mil.
Cash Flow from Operations was 4.4 + 48.4 + 97.6 + 7 = $157 Mil.
Revenue was 306.4 + 315 + 311.5 + 267.3 = $1,200 Mil.
Gross Profit was 0 + 0 + 0 + 0 = $0 Mil.
Total Assets at the begining of this year (Mar13) was $5,336 Mil.
Total Assets was $5,181 Mil.
Long-Term Debt was $275 Mil.
Total Current Assets was $0 Mil.
Total Current Liabilities was $0 Mil.
Net Income was 68.4 + -13.3 + -62.2 + 12.3 = $5 Mil.

Revenue was 348.3 + 295.5 + 346.3 + 282.6 = $1,273 Mil.
Gross Profit was 0 + 0 + 0 + 0 = $0 Mil.
Total Assets at the begining of last year (Mar12) was $5,629 Mil.
Total Assets was $5,336 Mil.
Long-Term Debt was $275 Mil.
Total Current Assets was $0 Mil.
Total Current Liabilities was $0 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.

OneBeacon Insurance Group Ltd's current net income was 125. ==> 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.

OneBeacon Insurance Group Ltd's current cash flow from operations was 157. ==> 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)
=124.6/5335.9
=0.02335126

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Mar12)
=5.2/5628.5
=0.00092387

OneBeacon Insurance Group Ltd's return on assets of this year was 0.02335126. OneBeacon Insurance Group Ltd's return on assets of last year was 0.00092387. ==> 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.

OneBeacon Insurance Group Ltd's current net income was 125. OneBeacon Insurance Group Ltd's current cash flow from operations was 157. ==> 157 > 125 ==> 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
=274.7/5181.1
=0.05301963

Gearing (Last Year)=Long-Term Debt/Total Assets
=274.7/5335.9
=0.05148147

OneBeacon Insurance Group Ltd's gearing of this year was 0.05301963. OneBeacon Insurance Group Ltd's gearing of last year was 0.05148147. ==> Last year is lower ==> Score 0.

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
=0/0
=

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=0/0
=

OneBeacon Insurance Group Ltd's current ratio of this year was . OneBeacon Insurance Group Ltd's current ratio of last year was . ==> 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.

OneBeacon Insurance Group Ltd's number of shares in issue this year was 94.6. OneBeacon Insurance Group Ltd's number of shares in issue last year was 94.5. ==> 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
=0/1200.2
=0

Gross Margin (Last Year)=Gross Profit/Revenue
=0/1272.7
=0

OneBeacon Insurance Group Ltd's gross margin of this year was 0. OneBeacon Insurance Group Ltd's gross margin of last year was 0. ==> Last year's gross margin is higher ==> Score 0.

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)
=1200.2/5335.9
=0.22492925

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Mar12)
=1272.7/5628.5
=0.22611708

OneBeacon Insurance Group Ltd's asset turnover of this year was 0.22492925. OneBeacon Insurance Group Ltd's asset turnover of last year was 0.22611708. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+1+1+0+0+0+0+0
=4

Good or high score = 8 or 9

Bad or low score = 0 or 1

OneBeacon Insurance Group Ltd 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.

OneBeacon Insurance Group Ltd Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 111011101
Q2 011111001
Q3 111010001
Q4 000100000
Q5 100011100
Q6 000000000
Q7 101111100
Q8 000000000
Q9 110010011
F-score 544364314

OneBeacon Insurance Group Ltd Quarterly Data

Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14
Q1 1111010111
Q2 0000010111
Q3 0000000111
Q4 0000011001
Q5 1100000000
Q6 0000000000
Q7 1000000000
Q8 0000000000
Q9 0111111110
F-score 3322142444
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