Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3
PMC-Sierra has an F-score of 7. It is a good or high score, which usually indicates a very healthy situation.
The historical rank and industry rank for PMC-Sierra's Piotroski F-Score or its related term are showing as below:
PMC-Sierra Piotroski F-Score Historical Data
The historical data trend for PMC-Sierra's Piotroski F-Score can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
*Note: If the latest quarterly/semi-annual/annual total assets data is 0, then we will use previous quarterly/semi-annual/annual data for all the items in the balance sheet.
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.
PMC-Sierra's current Net Income (TTM) was 5.1.
==> Positive ==> Score 1.
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.
PMC-Sierra's return on assets of this year was 0.00614532. PMC-Sierra's return on assets of last year was -0.02036153.
==> This year is higher. ==> Score 1.
Question 4. Quality of Earnings (Accrual)
Compare Cash flow return on assets (2) to return on assets (1)
PMC-Sierra's current ratio of this year was 1.75790007. PMC-Sierra's current ratio of last year was 2.0027691.
==> 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.
PMC-Sierra's number of shares in issue this year was 196.865. PMC-Sierra's number of shares in issue last year was 200.744.
==> 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.
PMC-Sierra's gross margin of this year was 0.70258186. PMC-Sierra's gross margin of last year was 0.70512816.
==> 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
PMC-Sierra's asset turnover of this year was 0.63355701. PMC-Sierra's asset turnover of last year was 0.58564687.
==> This year's asset turnover is higher. ==> Score 1.
Evaluation
Piotroski F-Score
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7
Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3
PMC-Sierra has an F-score of 7. It is a good or high score, which usually indicates a very healthy situation.
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.
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.
PMC-Sierra Piotroski F-Score Related Terms
Thank you for viewing the detailed overview of PMC-Sierra's Piotroski F-Score provided by GuruFocus.com. Please click on the following links to see related term pages.
PMC-Sierra Inc was incorporated in the state of California in 1983 and reincorporated in the state of Delaware in 1997. The Company is a semiconductor and and software solution provider transforming networks that connect, move and store digital content. It designs, develops, markets and supports semiconductor solutions by integrating its mixed-signal, software and systems expertise through a network of offices in North America, Europe and Asia. The Company has approximately 700 different semiconductor devices that are sold to equipment and design manufacturers, who in turn supply their equipment principally to service providers, carriers and enterprises globally. The Company provides semiconductor solutions for its customers by leveraging its intellectual property, design expertise and systems knowledge across a range of applications and industry protocols. The Company derives its net revenues from the following operating segments: Communication Products, Enterprise Storage Products, Microprocessor Products, and Broadband Wireless Products. The Company operates in one reportable segment-semiconductor solutions for communications network infrastructure. Its semiconductor devices enable networking equipment primarily in the following three end market segments: Storage, Optical and Mobile networks. The Storage market segment is made up of enterprise storage equipment manufacturers and covers two broad areas: server storage, and stand-alone external storage systems. The Optical market segment refers to infrastructure suppliers of transport and access networks that use optical transport protocol and/or physical optical medium. The Mobile market segment is mainly infrastructure equipment suppliers, including base station and backhaul equipment, supporting the wireless transmission of content from and to mobile hand devices. The Company faces competition at the customer design stage when its customers are determining which semiconductor components to use in its equipment designs. The Company competes against peer-group semiconductor companies that engage in the communications and storage semiconductor business. These companies include the following: Altera Corp., Applied Micro Circuits Corp.; Broadcom Corp.; Cortina Systems, Inc.; Emulex Corp.; Exar Corp.; Infineon Technologies AG; Intel Corp.; Texas Instrument Inc; LSI Corp.; Maxim Integrated Products, Inc.; Marvell Technology Group Ltd.; Mindspeed Technologies, Inc.; QLogic Corp.; Vitesse Semiconductor; and Xilinx, Inc. The Company has a total of 597 U.S. and 80 foreign patents for circuit designs and other innovations used in the design and architecture of its products. In addition, it has 95 patent applications pending in the U.S. Patent and Trademark office. The Company's business is subject to or may be impacted by various environmental protection and social responsibility legal and customer requirements.
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