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Spirit Airlines Inc (NAS:SAVE)
Piotroski F-Score
6 (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 6 indicating the company's financial situation is typical for a stable company.

SAVE' s 10-Year Piotroski F-Score Range
Min: 6   Max: 6
Current: 6

During the past 6 years, the highest Piotroski F-Score of Spirit Airlines Inc was 6. The lowest was 6. 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 (Dec13) TTM:Last Year (Dec12) TTM:
Net Income was 43.193 + 61.103 + 42.068 + 30.554 = $177 Mil.
Cash Flow from Operations was 21.745 + 39.371 + 49.067 + 85.193 = $195 Mil.
Revenue was 419.984 + 456.625 + 407.339 + 370.437 = $1,654 Mil.
Gross Profit was 197.176 + 230.491 + 193.625 + 226.991 = $848 Mil.
Total Assets at the begining of this year (Dec12) was $920 Mil.
Total Assets was $1,181 Mil.
Long-Term Debt was $0 Mil.
Total Current Assets was $649 Mil.
Total Current Liabilities was $336 Mil.
Net Income was 19.566 + 30.884 + 34.591 + 23.419 = $108 Mil.

Revenue was 328.268 + 342.317 + 346.308 + 301.495 = $1,318 Mil.
Gross Profit was 141.042 + 149.494 + 159.834 + 182.841 = $633 Mil.
Total Assets at the begining of last year (Dec11) was $746 Mil.
Total Assets was $920 Mil.
Long-Term Debt was $0 Mil.
Total Current Assets was $547 Mil.
Total Current Liabilities was $277 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 177. ==> 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 195. ==> 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 (Dec12)
=176.918/919.884
=0.19232642

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=108.46/745.813
=0.14542519

Spirit Airlines Inc's return on assets of this year was 0.19232642. Spirit Airlines Inc's return on assets of last year was 0.14542519. ==> 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 177. Spirit Airlines Inc's current cash flow from operations was 195. ==> 195 > 177 ==> CFROA > ROA ==> Score 1.

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 1 if gearing is lower, 0 if it’s higher.

Gearing (This Year)=Long-Term Debt/Total Assets
=0/1180.765
=0

Gearing (Last Year)=Long-Term Debt/Total Assets
=0/919.884
=0

Spirit Airlines Inc's gearing of this year was 0. Spirit Airlines Inc's gearing of last year was 0. ==> Last year is lower ==> Score 0.

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
=649.075/335.993
=1.93181108

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=547.357/276.894
=1.97677451

Spirit Airlines Inc's current ratio of this year was 1.93181108. Spirit Airlines Inc's current ratio of last year was 1.97677451. ==> 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 1 if there is fewer number of shares in issue this year. Score 0 otherwise.

Spirit Airlines Inc's number of shares in issue this year was 73.2. Spirit Airlines Inc's number of shares in issue last year was 72.6. ==> There is more 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
=848.283/1654.385
=0.51274824

Gross Margin (Last Year)=Gross Profit/Revenue
=633.211/1318.388
=0.48029184

Spirit Airlines Inc's gross margin of this year was 0.51274824. Spirit Airlines Inc's gross margin of last year was 0.48029184. ==> 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 (Dec12)
=1654.385/919.884
=1.79847133

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=1318.388/745.813
=1.76771925

Spirit Airlines Inc's asset turnover of this year was 1.79847133. Spirit Airlines Inc's asset turnover of last year was 1.76771925. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+1+1+0+0+0+1+1
=6

Good or high score = 8 or 9

Bad or low score = 0 or 1

Spirit Airlines Inc has an F-score of 6 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 00
Q6 10
Q7 00
Q8 01
Q9 01
F-score 46

Spirit Airlines Inc Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 1111111
Q2 1111111
Q3 0100011
Q4 1011111
Q5 0000000
Q6 1110000
Q7 0010000
Q8 0011111
Q9 0000011
F-score 0004464466
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