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Sandstorm Gold Ltd (AMEX:SAND)
Piotroski F-Score
4 (As of Today)

The zones of discrimination were as such:

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

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

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

4
7

During the past 8 years, the highest Piotroski F-Score of Sandstorm Gold Ltd was 7. The lowest was 4. 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 own currency.

This Year (Dec14) TTM:Last Year (Dec13) TTM:
Net Income was -10.095 + 3.039 + 2.076 + 2.608 = $-2.37 Mil.
Cash Flow from Operations was 0.56 + 9.383 + 9.962 + 8.85 = $28.76 Mil.
Revenue was 0.952 + 13.153 + 15.559 + 12.488 = $42.15 Mil.
Gross Profit was 0.148 + 3.308 + 3.57 + 2.376 = $9.40 Mil.
Average Total Assets from the begining of this year (Dec13)
to the end of this year (Dec14) was
(379.703 + 51.547 + 456.05 + 445.368 + 431.07) / 5 = $352.7476 Mil.
Total Assets at the begining of this year (Dec13) was $379.70 Mil.
Long-Term Debt was $0.00 Mil.
Total Current Assets was $92.97 Mil.
Total Current Liabilities was $3.63 Mil.
Net Income was 7.367 + -14.975 + -1.446 + -39.863 = $-48.92 Mil.

Revenue was 12.423 + 13.353 + 15.352 + 15.767 = $56.90 Mil.
Gross Profit was 6.724 + 4.262 + 5.064 + 4.567 = $20.62 Mil.
Average Total Assets from the begining of last year (Sep12)
to the end of last year (Dec13) was
(332.436 + 341.427 + 418.545 + 420.869 + 379.703) / 5 = $378.596 Mil.
Total Assets at the begining of last year (Sep12) was $332.44 Mil.
Long-Term Debt was $0.00 Mil.
Total Current Assets was $101.56 Mil.
Total Current Liabilities was $3.43 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.

Sandstorm Gold Ltd's current net income (TTM) was -2.37. ==> 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.

Sandstorm Gold Ltd's current cash flow from operations (TTM) was 28.76. ==> 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 (Dec13)
=-2.372/379.703
=-0.00624699

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=-48.917/332.436
=-0.14714712

Sandstorm Gold Ltd's return on assets of this year was -0.00624699. Sandstorm Gold Ltd's return on assets of last year was -0.14714712. ==> 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.

Sandstorm Gold Ltd's current net income (TTM) was -2.37. Sandstorm Gold Ltd's current cash flow from operations (TTM) was 28.76. ==> 28.76 > -2.37 ==> 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: Dec14)=Long-Term Debt/Average Total Assets from Dec13 to Dec14
=0/352.7476
=0

Gearing (Last Year: Dec13)=Long-Term Debt/Average Total Assets from Sep12 to Dec13
=0/378.596
=0

Sandstorm Gold Ltd's gearing of this year was 0. Sandstorm Gold Ltd's gearing of last year was 0. ==> 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: Dec14)=Total Current Assets/Total Current Liabilities
=92.97/3.631
=25.60451666

Current Ratio (Last Year: Dec13)=Total Current Assets/Total Current Liabilities
=101.561/3.433
=29.58374599

Sandstorm Gold Ltd's current ratio of this year was 25.60451666. Sandstorm Gold Ltd's current ratio of last year was 29.58374599. ==> 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.

Sandstorm Gold Ltd's number of shares in issue this year was 126.1. Sandstorm Gold Ltd's number of shares in issue last year was 99.8. ==> There is larger number of shares in issue this year. ==> Score 0.

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
=9.402/42.152
=0.22304991

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=20.617/56.895
=0.36236928

Sandstorm Gold Ltd's gross margin of this year was 0.22304991. Sandstorm Gold Ltd's gross margin of last year was 0.36236928. ==> 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 (Dec13)
=42.152/379.703
=0.11101308

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Sep12)
=56.895/332.436
=0.17114572

Sandstorm Gold Ltd's asset turnover of this year was 0.11101308. Sandstorm Gold Ltd's asset turnover of last year was 0.17114572. ==> 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+1+1+1+0+0+0+0
=4

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

Sandstorm Gold 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.

Sandstorm Gold Ltd Annual Data

Mar07Mar08Mar09Dec10Dec11Dec12Dec13Dec14
Question 1 1101
Question 2 1111
Question 3 1101
Question 4 1111
Question 5 1111
Question 6 0110
Question 7 0000
Question 8 0000
Question 9 0100
F-score 5745

Sandstorm Gold Ltd Quarterly Data

Jun12Sep12Dec12Jun13Sep13Dec13Mar14Jun14Sep14Dec14
Question 1 1111000000
Question 2 1111111111
Question 3 1010000001
Question 4 1111111111
Question 5 1111110111
Question 6 0110110000
Question 7 0000001000
Question 8 1000000000
Question 9 1111000000
F-score 7674442334
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