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Rockwell Automation Inc (NYSE:ROK)
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 = 8 or 9
Bad or low score = 0 or 1

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

ROK' s 10-Year Piotroski F-Score Range
Min: 2   Max: 9
Current: 7

2
9

During the past 13 years, the highest Piotroski F-Score of Rockwell Automation Inc was 9. The lowest was 2. 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 (Jun14) TTM:Last Year (Jun13) TTM:
Net Income was 215.3 + 198.1 + 180.3 + 199.7 = $793 Mil.
Cash Flow from Operations was 351 + 203.5 + 202.8 + 301.1 = $1,058 Mil.
Revenue was 1715.7 + 1591.7 + 1600.5 + 1649.5 = $6,557 Mil.
Gross Profit was 697.2 + 663.7 + 655.8 + 681.5 = $2,698 Mil.
Average Total Assets from the begining of this year (Jun13)
to the end of this year (Jun14) was
(5771.3 + 5844.6 + 5940.8 + 6158.1 + 6145.1) / 5 = $5,972 Mil.
Total Assets was $6,145 Mil.
Long-Term Debt was $905 Mil.
Total Current Assets was $3,908 Mil.
Total Current Liabilities was $1,713 Mil.
Net Income was 195.2 + 161.4 + 175.9 + 203.7 = $736 Mil.

Revenue was 1664 + 1489.2 + 1522.8 + 1624.2 = $6,300 Mil.
Gross Profit was 654.2 + 607.3 + 616.4 + 652.9 = $2,531 Mil.
Average Total Assets from the begining of last year (Jun12)
to the end of last year (Jun13) was
(5382.4 + 5636.5 + 5711.1 + 5719.9 + 5771.3) / 5 = $5,644 Mil.
Total Assets was $5,771 Mil.
Long-Term Debt was $905 Mil.
Total Current Assets was $3,485 Mil.
Total Current Liabilities was $1,552 Mil.

Profitability

Q1. Return on Assets (ROA)

Net income before extraordinary items for the year divided by average total assets throughout the year.

Score 1 if positive, 0 if negative.

Rockwell Automation Inc's current net income (ttm) was 793. ==> Positive ==> Score 1.

Q2. Cash Flow Return on Assets (CFROA)

Net cash flow from operating activities (operating cash flow) divided by average total assets throughout the year.

Score 1 if positive, 0 if negative.

Rockwell Automation Inc's current cash flow from operations (ttm) was 1,058. ==> 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)/Average Total Assets from Jun13 to Jun14
=793.4/5971.98
=0.13285376

ROA (Last Year)=Net Income (TTM)/Average Total Assets from Jun12 to Jun13
=736.2/5644.24
=0.13043386

Rockwell Automation Inc's return on assets of this year was 0.13285376. Rockwell Automation Inc's return on assets of last year was 0.13043386. ==> 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.

Rockwell Automation Inc's current net income (ttm) was 793. Rockwell Automation Inc's current cash flow from operations (ttm) was 1,058. ==> 1,058 > 793 ==> CFROA > ROA ==> Score 1.

Funding

Q5. Change in Gearing or Leverage

Compare this year’s gearing (long-term debt divided by total assets) to last year’s gearing.

Score 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year: Jun14)=Long-Term Debt/Total Assets
=905.4/6145.1
=0.1473369

Gearing (Last Year: Jun13)=Long-Term Debt/Total Assets
=905.1/5771.3
=0.15682775

Rockwell Automation Inc's gearing of this year was 0.1473369. Rockwell Automation Inc's gearing of last year was 0.15682775. ==> 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: Jun14)=Total Current Assets/Total Current Liabilities
=3907.7/1712.7
=2.28160215

Current Ratio (Last Year: Jun13)=Total Current Assets/Total Current Liabilities
=3485.1/1552.3
=2.24512014

Rockwell Automation Inc's current ratio of this year was 2.28160215. Rockwell Automation Inc's current ratio of last year was 2.24512014. ==> This year's current ratio is higher. ==> Score 1.

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.

Rockwell Automation Inc's number of shares in issue this year was 139.6. Rockwell Automation Inc's number of shares in issue last year was 140.4. ==> 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
=2698.2/6557.4
=0.41147406

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=2530.8/6300.2
=0.40170153

Rockwell Automation Inc's gross margin of this year was 0.41147406. Rockwell Automation Inc's gross margin of last year was 0.40170153. ==> 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 average total assets throughout 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)/Average Total Assets from Jun13 to Jun14
=6557.4/5971.98
=1.09802779

Asset Turnover (Last Year)=Revenue (TTM)/Average Total Assets from Jun12 to Jun13
=6300.2/5644.24
=1.1162176

Rockwell Automation Inc's asset turnover of this year was 1.09802779. Rockwell Automation Inc's asset turnover of last year was 1.1162176. ==> 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+1+1+1+1+0
=8

Good or high score = 8 or 9

Bad or low score = 0 or 1

Rockwell Automation 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, Altman Z-Score, Beneish M-Score


Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their own currency.

Rockwell Automation Inc Annual Data

Sep04Sep05Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13
Q1 1111111111
Q2 1111111111
Q3 1111001111
Q4 1100111001
Q5 1111001111
Q6 1000110101
Q7 0111110011
Q8 1111001011
Q9 1011101111
F-score 8777657679

Rockwell Automation Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
Q1 1111111111
Q2 1111111111
Q3 1100000111
Q4 0001111111
Q5 1111111111
Q6 0001111101
Q7 1111111111
Q8 1110001111
Q9 1100000000
F-score 8866667877
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