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Sycamore Networks Inc (OTCPK:SCMR)
Piotroski F-Score
5 (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

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

SCMR' s 10-Year Piotroski F-Score Range
Min: 1   Max: 8
Current: 5

1
8

During the past 13 years, the highest Piotroski F-Score of Sycamore Networks Inc was 8. The lowest was 1. 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 (Oct14) TTM:Last Year (Apr12) TTM:
Net Income was -2.525 + -6.756 + -5.24 + 0 = $-14.52 Mil.
Cash Flow from Operations was -0.362 + -5.013 + -8.828 + 0 = $-14.20 Mil.
Revenue was 16.799 + 12.064 + 9.47 + 0 = $38.33 Mil.
Gross Profit was 9.62 + 7.161 + 5.449 + 0 = $22.23 Mil.
Average Total Assets from the begining of this year (Apr12)
to the end of this year (Oct14) was
(462.927 + 461.934 + 164.983 + 87.093 + 14.527) / 5 = $238.2928 Mil.
Total Assets at the begining of this year (Apr12) was $462.93 Mil.
Long-Term Debt was $0.00 Mil.
Total Current Assets was $11.93 Mil.
Total Current Liabilities was $0.16 Mil.
Net Income was -3.618 + -1.614 + -3.694 + -5.091 = $-14.02 Mil.

Revenue was 12.959 + 15.38 + 13.184 + 11.922 = $53.45 Mil.
Gross Profit was 7.332 + 9.118 + 7.749 + 6.467 = $30.67 Mil.
Average Total Assets from the begining of last year (Apr11)
to the end of last year (Apr12) was
(468.975 + 469.737 + 465.006 + 468.495 + 462.927) / 5 = $467.028 Mil.
Total Assets at the begining of last year (Apr11) was $468.98 Mil.
Long-Term Debt was $0.00 Mil.
Total Current Assets was $368.56 Mil.
Total Current Liabilities was $15.58 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.

Sycamore Networks Inc's current net income (TTM) was -14.52. ==> Negative ==> Score 0.

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.

Sycamore Networks Inc's current cash flow from operations (TTM) was -14.20. ==> Negative ==> Score 0.

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)/Total Assets at the Beginning of This Year (Apr12)
=-14.521/462.927
=-0.0313678

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Apr11)
=-14.017/468.975
=-0.02988859

Sycamore Networks Inc's return on assets of this year was -0.0313678. Sycamore Networks Inc's return on assets of last year was -0.02988859. ==> Last year is higher ==> Score 0.

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.

Sycamore Networks Inc's current net income (TTM) was -14.52. Sycamore Networks Inc's current cash flow from operations (TTM) was -14.20. ==> -14.20 > -14.52 ==> 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 0 if this year's gearing is higher, 1 otherwise.

Gearing (This Year: Oct14)=Long-Term Debt/Average Total Assets from Apr12 to Oct14
=0/238.2928
=0

Gearing (Last Year: Apr12)=Long-Term Debt/Average Total Assets from Apr11 to Apr12
=0/467.028
=0

Sycamore Networks Inc's gearing of this year was 0. Sycamore Networks 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: Oct14)=Total Current Assets/Total Current Liabilities
=11.926/0.157
=75.96178344

Current Ratio (Last Year: Apr12)=Total Current Assets/Total Current Liabilities
=368.556/15.581
=23.65419421

Sycamore Networks Inc's current ratio of this year was 75.96178344. Sycamore Networks Inc's current ratio of last year was 23.65419421. ==> 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.

Sycamore Networks Inc's number of shares in issue this year was 0. Sycamore Networks Inc's number of shares in issue last year was 28.9. ==> 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
=22.23/38.333
=0.57991809

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=30.666/53.445
=0.57378614

Sycamore Networks Inc's gross margin of this year was 0.57991809. Sycamore Networks Inc's gross margin of last year was 0.57378614. ==> 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 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 (Apr12)
=38.333/462.927
=0.08280571

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Apr11)
=53.445/468.975
=0.1139613

Sycamore Networks Inc's asset turnover of this year was 0.08280571. Sycamore Networks Inc's asset turnover of last year was 0.1139613. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=0+0+0+1+1+1+1+1+0
=5

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

Sycamore Networks 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.

Sycamore Networks Inc Annual Data

Jul03Jul04Jul05Jul06Jul07Jul08Jul09Jul10Jul11Jul12
Q1 0001000000
Q2 0001110000
Q3 1011010100
Q4 1111111111
Q5 1111110011
Q6 1010010100
Q7 0010100000
Q8 1111010101
Q9 0111100111
F-score 5477561534

Sycamore Networks Inc Quarterly Data

Jan11Apr11Jul11Oct11Jan12Apr12Jul12Oct12Jan13Oct14
Q1 0000000000
Q2 0000000000
Q3 1100000000
Q4 1110111111
Q5 1111111111
Q6 1100000001
Q7 0000000001
Q8 1101111001
Q9 1111111100
F-score 6633444325
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