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Spirit Airlines Inc (NAS:SAVE)
Piotroski F-Score
5 (As of Today)

The zones of discrimination were as such:

Good or high score = 8 or 9
Bad or low score = 0 or 1

Spirit Airlines Inc has an F-score of 5 indicating the company's financial situation is typical for a stable company.

SAVE' s 10-Year Piotroski F-Score Range
Min: 4   Max: 7
Current: 5

4
7

During the past 6 years, the highest Piotroski F-Score of Spirit Airlines Inc 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 (Jun14) TTM:Last Year (Jun13) TTM:
Net Income was 64.849 + 37.706 + 43.193 + 61.103 = $207 Mil.
Cash Flow from Operations was 53.496 + 90.639 + 21.745 + 39.371 = $205 Mil.
Revenue was 499.337 + 437.987 + 419.984 + 456.625 = $1,814 Mil.
Gross Profit was 251.227 + 201.499 + 197.176 + 230.491 = $880 Mil.
Total Assets at the begining of this year (Jun13) was $1,107 Mil.
Total Assets was $1,350 Mil.
Long-Term Debt was $0 Mil.
Total Current Assets was $688 Mil.
Total Current Liabilities was $401 Mil.
Net Income was 42.068 + 30.554 + 19.566 + 30.884 = $123 Mil.

Revenue was 407.339 + 370.437 + 328.268 + 342.317 = $1,448 Mil.
Gross Profit was 193.625 + 226.991 + -16.667 + 206.09 = $610 Mil.
Total Assets at the begining of last year (Jun12) was $870 Mil.
Total Assets was $1,107 Mil.
Long-Term Debt was $0 Mil.
Total Current Assets was $677 Mil.
Total Current Liabilities was $380 Mil.

Profitability

Q1. 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.

Spirit Airlines Inc's current net income was 207. ==> Positive ==> Score 1.

Q2. 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.

Spirit Airlines Inc's current cash flow from operations was 205. ==> 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/Total Assets at the beginning of this year (Jun13)
=206.851/1107.061
=0.18684698

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Jun12)
=123.072/869.525
=0.14153935

Spirit Airlines Inc's return on assets of this year was 0.18684698. Spirit Airlines Inc's return on assets of last year was 0.14153935. ==> 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.

Spirit Airlines Inc's current net income was 207. Spirit Airlines Inc's current cash flow from operations was 205. ==> 205 =< 207 ==> CFROA =< ROA ==> Score 0.

Funding

Q5. 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)=Long-Term Debt/Total Assets
=0/1349.85
=0

Gearing (Last Year)=Long-Term Debt/Total Assets
=0/1107.061
=0

Spirit Airlines Inc's gearing of this year was 0. Spirit Airlines Inc's gearing of last year was 0. ==> 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)=Total Current Assets/Total Current Liabilities
=688.461/400.538
=1.71884066

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=676.612/380.399
=1.77869027

Spirit Airlines Inc's current ratio of this year was 1.71884066. Spirit Airlines Inc's current ratio of last year was 1.77869027. ==> Last year's current ratio is higher ==> Score 0.

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.

Spirit Airlines Inc's number of shares in issue this year was 73.3. Spirit Airlines Inc's number of shares in issue last year was 73. ==> There is larger number of shares in issue this year. ==> Score 0.

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)=Gross Profit/Revenue
=880.393/1813.933
=0.48535034

Gross Margin (Last Year)=Gross Profit/Revenue
=610.039/1448.361
=0.42119264

Spirit Airlines Inc's gross margin of this year was 0.48535034. Spirit Airlines Inc's gross margin of last year was 0.42119264. ==> This year's gross margin is higher. ==> Score 1.

Q9. Change in asset turnover

Compare this year’s asset turnover (total sales 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/Total Assets at the beginning of this year (Jun13)
=1813.933/1107.061
=1.63851224

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Jun12)
=1448.361/869.525
=1.66569219

Spirit Airlines Inc's asset turnover of this year was 1.63851224. Spirit Airlines Inc's asset turnover of last year was 1.66569219. ==> 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+0+1+0+0+1+0
=5

Good or high score = 8 or 9

Bad or low score = 0 or 1

Spirit Airlines Inc has an F-score of 5 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.

Spirit Airlines Inc Annual Data

Dec08Dec09Dec10Dec11Dec12Dec13
Q1 11
Q2 11
Q3 01
Q4 11
Q5 11
Q6 10
Q7 00
Q8 01
Q9 01
F-score 57

Spirit Airlines Inc Quarterly Data

Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13Mar14Jun14
Q1 111111111
Q2 111111111
Q3 010001111
Q4 101111110
Q5 111111111
Q6 111000000
Q7 001000000
Q8 001100111
Q9 000001110
F-score 0557546775
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