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Occidental Petroleum Corp (NYSE:OXY)
Piotroski F-Score
3 (As of Today)

Warning Sign:

Piotroski F-Score of 3 is low, which usually implies poor business operation.

The zones of discrimination were as such:

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

Occidental Petroleum Corp has an F-score of 3. It is a bad or low score, which usually implies poor business operation.

OXY' s Piotroski F-Score Range Over the Past 10 Years
Min: 3   Max: 9
Current: 3

3
9

During the past 13 years, the highest Piotroski F-Score of Occidental Petroleum Corp was 9. The lowest was 3. 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 (Mar16) TTM:Last Year (Mar15) TTM:
Net Income was 176 + -2609 + -5178 + 78 = $-7,533 Mil.
Cash Flow from Operations was 805 + 1020 + 965 + 689 = $3,479 Mil.
Revenue was 3514 + 3246 + 2843 + 2281 = $11,884 Mil.
Gross Profit was 2034 + 1833 + 1489 + 1000 = $6,356 Mil.
Average Total Assets from the begining of this year (Mar15)
to the end of this year (Mar16) was
(53389 + 54369 + 50089 + 43437 + 42018) / 5 = $48660.4 Mil.
Total Assets at the begining of this year (Mar15) was $53,389 Mil.
Long-Term Debt was $5,608 Mil.
Total Current Assets was $8,237 Mil.
Total Current Liabilities was $6,826 Mil.
Net Income was 1431 + 1208 + -3413 + -218 = $-992 Mil.

Revenue was 5705 + 4930 + 6314 + 3096 = $20,045 Mil.
Gross Profit was 4014 + 3194 + 4581 + 1539 = $13,328 Mil.
Average Total Assets from the begining of last year (Mar14)
to the end of last year (Mar15) was
(69275 + 70293 + 71510 + 56259 + 53389) / 5 = $64145.2 Mil.
Total Assets at the begining of last year (Mar14) was $69,275 Mil.
Long-Term Debt was $6,139 Mil.
Total Current Assets was $10,434 Mil.
Total Current Liabilities was $6,915 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.

Occidental Petroleum Corp's current net income (TTM) was -7,533. ==> 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.

Occidental Petroleum Corp's current cash flow from operations (TTM) was 3,479. ==> 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)
=-7533/53389
=-0.14109648

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Mar14)
=-992/69275
=-0.01431974

Occidental Petroleum Corp's return on assets of this year was -0.14109648. Occidental Petroleum Corp's return on assets of last year was -0.01431974. ==> 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.

Occidental Petroleum Corp's current net income (TTM) was -7,533. Occidental Petroleum Corp's current cash flow from operations (TTM) was 3,479. ==> 3,479 > -7,533 ==> 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
=5608/48660.4
=0.11524772

Gearing (Last Year: Mar15)=Long-Term Debt/Average Total Assets from Mar14 to Mar15
=6139/64145.2
=0.09570474

Occidental Petroleum Corp's gearing of this year was 0.11524772. Occidental Petroleum Corp's gearing of last year was 0.09570474. ==> Last year is lower than this year ==> Score 0.

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
=8237/6826
=1.20670964

Current Ratio (Last Year: Mar15)=Total Current Assets/Total Current Liabilities
=10434/6915
=1.50889371

Occidental Petroleum Corp's current ratio of this year was 1.20670964. Occidental Petroleum Corp's current ratio of last year was 1.50889371. ==> 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.

Occidental Petroleum Corp's number of shares in issue this year was 763.4. Occidental Petroleum Corp's number of shares in issue last year was 769.6. ==> 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
=6356/11884
=0.53483676

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=13328/20045
=0.66490397

Occidental Petroleum Corp's gross margin of this year was 0.53483676. Occidental Petroleum Corp's gross margin of last year was 0.66490397. ==> 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)
=11884/53389
=0.22259267

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Mar14)
=20045/69275
=0.28935402

Occidental Petroleum Corp's asset turnover of this year was 0.22259267. Occidental Petroleum Corp's asset turnover of last year was 0.28935402. ==> 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+0+0+1+0+0
=3

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

Occidental Petroleum Corp has an F-score of 3. It is a bad or low score, which usually implies poor business operation.


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.

Occidental Petroleum Corp Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15
Question 1 1111111110
Question 2 1111111111
Question 3 0110110100
Question 4 1111111111
Question 5 1110010110
Question 6 0101100110
Question 7 0111111111
Question 8 1110110100
Question 9 0010110000
F-score 5885884863

Occidental Petroleum Corp Quarterly Data

Dec13Mar14Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16
Question 1 1111100000
Question 2 1111111111
Question 3 1111000000
Question 4 1111111111
Question 5 1111110000
Question 6 1100111100
Question 7 1111111111
Question 8 1111000000
Question 9 0000000000
F-score 8877654433
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