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GuruFocus has detected 1 Warning Sign with Perry Ellis International Inc $PERY.
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Perry Ellis International Inc (NAS:PERY)
Piotroski F-Score
8 (As of Today)

Good Sign:

Piotroski F-Score of 8 is 8, 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

Perry Ellis International Inc has an F-score of 8. It is a good or high score, which usually indicates a very healthy situation.

PERY' s Piotroski F-Score Range Over the Past 10 Years
Min: 3   Max: 9
Current: 8

3
9

During the past 13 years, the highest Piotroski F-Score of Perry Ellis International Inc was 9. 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 local exchange's currency.

This Year (Oct16) TTM:Last Year (Oct15) TTM:
Net Income was -17.695 + 14.25 + -3.565 + -5.165 = $-12.2 Mil.
Cash Flow from Operations was 11.527 + -39 + 73.934 + 2.307 = $48.8 Mil.
Revenue was 214.363 + 261.294 + 201.653 + 193.959 = $871.3 Mil.
Gross Profit was 79.73 + 95.084 + 73.831 + 71.103 = $319.7 Mil.
Average Total Assets from the begining of this year (Oct15)
to the end of this year (Oct16) was
(606.664 + 622.447 + 628.628 + 559.345 + 547.538) / 5 = $592.9244 Mil.
Total Assets at the begining of this year (Oct15) was $606.7 Mil.
Long-Term Debt was $108.1 Mil.
Total Current Assets was $293.8 Mil.
Total Current Liabilities was $80.3 Mil.
Net Income was -42.897 + 9.411 + -1.281 + 2.273 = $-32.5 Mil.

Revenue was 217.686 + 266.414 + 213.299 + 205.439 = $902.8 Mil.
Gross Profit was 74.568 + 90.1 + 75.942 + 73.295 = $313.9 Mil.
Average Total Assets from the begining of last year (Oct14)
to the end of last year (Oct15) was
(655.61 + 684.989 + 662.815 + 614.024 + 606.664) / 5 = $644.8204 Mil.
Total Assets at the begining of last year (Oct14) was $655.6 Mil.
Long-Term Debt was $132.1 Mil.
Total Current Assets was $323.4 Mil.
Total Current Liabilities was $101.9 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.

Perry Ellis International Inc's current net income (TTM) was -12.2. ==> 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.

Perry Ellis International Inc's current cash flow from operations (TTM) was 48.8. ==> 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 (Oct15)
=-12.175/606.664
=-0.02006877

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Oct14)
=-32.494/655.61
=-0.049563

Perry Ellis International Inc's return on assets of this year was -0.02006877. Perry Ellis International Inc's return on assets of last year was -0.049563. ==> This year is higher. ==> Score 1.

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.

Perry Ellis International Inc's current net income (TTM) was -12.2. Perry Ellis International Inc's current cash flow from operations (TTM) was 48.8. ==> 48.8 > -12.2 ==> 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: Oct16)=Long-Term Debt/Average Total Assets from Oct15 to Oct16
=108.142/592.9244
=0.1823875

Gearing (Last Year: Oct15)=Long-Term Debt/Average Total Assets from Oct14 to Oct15
=132.138/644.8204
=0.20492218

Perry Ellis International Inc's gearing of this year was 0.1823875. Perry Ellis International Inc's gearing of last year was 0.20492218. ==> 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: Oct16)=Total Current Assets/Total Current Liabilities
=293.792/80.289
=3.65918121

Current Ratio (Last Year: Oct15)=Total Current Assets/Total Current Liabilities
=323.39/101.905
=3.17344586

Perry Ellis International Inc's current ratio of this year was 3.65918121. Perry Ellis International Inc's current ratio of last year was 3.17344586. ==> This year's current ratio is higher. ==> Score 1.

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.

Perry Ellis International Inc's number of shares in issue this year was 15. Perry Ellis International Inc's number of shares in issue last year was 15.5. ==> 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
=319.748/871.269
=0.36699114

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=313.905/902.838
=0.34768696

Perry Ellis International Inc's gross margin of this year was 0.36699114. Perry Ellis International Inc's gross margin of last year was 0.34768696. ==> This year's gross margin is higher. ==> Score 1.

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 (Oct15)
=871.269/606.664
=1.43616401

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Oct14)
=902.838/655.61
=1.37709614

Perry Ellis International Inc's asset turnover of this year was 1.43616401. Perry Ellis International Inc's asset turnover of last year was 1.37709614. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score= Que. 1+ Que. 2+ Que. 3+Que. 4+Que. 5+Que. 6+Que. 7+Que. 8+Que. 9
=0+1+1+1+1+1+1+1+1
=8

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

Perry Ellis International Inc has an F-score of 8. 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 local exchange's currency.

Perry Ellis International Inc Annual Data

Jan08Jan09Jan10Jan11Jan12Jan13Jan14Jan15Jan16Jan17
Question 1 1011110001
Question 2 1011111111
Question 3 1011000011
Question 4 1110011111
Question 5 1010110011
Question 6 0101101001
Question 7 0110011100
Question 8 1011001111
Question 9 1001100111
F-score 7376555568

Perry Ellis International Inc Quarterly Data

Oct14Jan15Apr15Jul15Oct15Jan16Apr16Jul16Oct16Jan17
Question 1 0000000001
Question 2 1111111111
Question 3 0000011111
Question 4 1111111111
Question 5 0011110111
Question 6 1000001111
Question 7 1100001110
Question 8 1111111111
Question 9 0111111111
F-score 5555567888
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