Switch to:
TE Connectivity Ltd (NYSE:TEL)
Piotroski F-Score
8 (As of Today)

Good Sign:

Piotroski F-Score of 8 is 8, 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

TE Connectivity Ltd has an F-score of 8. It is a good or high score, which usually indicates a very healthy situation.

TEL' s 10-Year Piotroski F-Score Range
Min: 2   Max: 8
Current: 8

2
8

During the past 12 years, the highest Piotroski F-Score of TE Connectivity Ltd was 8. The lowest was 2. And the median was 7.


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 353 + 387 + 335 + 277 = $1,352 Mil.
Cash Flow from Operations was 385 + 593 + 616 + 445 = $2,039 Mil.
Revenue was 3326 + 3432 + 3449 + 3265 = $13,472 Mil.
Gross Profit was 1117 + 1156 + 1132 + 1052 = $4,457 Mil.
Total Assets at the begining of this year (Dec12) was $18,136 Mil.
Total Assets was $18,443 Mil.
Long-Term Debt was $2,615 Mil.
Total Current Assets was $6,358 Mil.
Total Current Liabilities was $3,409 Mil.
Net Income was 277 + 396 + 199 + 257 = $1,129 Mil.

Revenue was 3134 + 3364 + 3499 + 3249 = $13,246 Mil.
Gross Profit was 989 + 1064 + 1018 + 1021 = $4,092 Mil.
Total Assets at the begining of last year (Dec11) was $17,523 Mil.
Total Assets was $18,136 Mil.
Long-Term Debt was $2,687 Mil.
Total Current Assets was $5,753 Mil.
Total Current Liabilities was $3,111 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.

TE Connectivity Ltd's current net income was 1,352. ==> 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.

TE Connectivity Ltd's current cash flow from operations was 2,039. ==> 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)
=1352/18136
=0.07454786

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=1129/17523
=0.06442961

TE Connectivity Ltd's return on assets of this year was 0.07454786. TE Connectivity Ltd's return on assets of last year was 0.06442961. ==> 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.

TE Connectivity Ltd's current net income was 1,352. TE Connectivity Ltd's current cash flow from operations was 2,039. ==> 2,039 > 1,352 ==> 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
=2615/18443
=0.14178821

Gearing (Last Year)=Long-Term Debt/Total Assets
=2687/18136
=0.14815836

TE Connectivity Ltd's gearing of this year was 0.14178821. TE Connectivity Ltd's gearing of last year was 0.14815836. ==> This year is lower. ==> 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
=6358/3409
=1.86506307

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=5753/3111
=1.84924462

TE Connectivity Ltd's current ratio of this year was 1.86506307. TE Connectivity Ltd's current ratio of last year was 1.84924462. ==> 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 1 if there is fewer number of shares in issue this year. Score 0 otherwise.

TE Connectivity Ltd's number of shares in issue this year was 418. TE Connectivity Ltd's number of shares in issue last year was 426. ==> There is the same number of shares in issue this year, or fewer. ==> 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)=Gross Profit/Revenue
=4457/13472
=0.33083432

Gross Margin (Last Year)=Gross Profit/Revenue
=4092/13246
=0.30892345

TE Connectivity Ltd's gross margin of this year was 0.33083432. TE Connectivity Ltd's gross margin of last year was 0.30892345. ==> 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)
=13472/18136
=0.74283194

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=13246/17523
=0.75592079

TE Connectivity Ltd's asset turnover of this year was 0.74283194. TE Connectivity Ltd's asset turnover of last year was 0.75592079. ==> 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

TE Connectivity Ltd 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


Historical Data

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

TE Connectivity Ltd Annual Data

Sep04Sep05Sep06Sep07Sep08Sep09Sep10Sep11Sep12Sep13
Q1 10101111
Q2 11111111
Q3 10101101
Q4 11011111
Q5 01011011
Q6 10100100
Q7 10111111
Q8 00101001
Q9 11001100
F-score 74648757

TE Connectivity Ltd Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 1111111111
Q2 1111111111
Q3 1000000111
Q4 1111111111
Q5 0111101111
Q6 1010010001
Q7 1111111111
Q8 0000011111
Q9 1100000000
F-score 7665566778
Get WordPress Plugins for easy affiliate links on Stock Tickers and Guru Names | Earn affiliate commissions by embedding GuruFocus Charts
GuruFocus Affiliate Program: Earn up to $400 per referral. ( Learn More)
Free 7-day Trial
FEEDBACK
Hide