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Tiffany & Co. (NYSE:TIF)
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

Tiffany & Co. has an F-score of 4 indicating the company's financial situation is typical for a stable company.

TIF' s 10-Year Piotroski F-Score Range
Min: 3   Max: 9
Current: 5

3
9

During the past 13 years, the highest Piotroski F-Score of Tiffany & Co. was 9. The lowest was 3. 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 (Jan14) TTM:Last Year (Jan13) TTM:
Net Income was -103.599 + 94.61 + 106.781 + 83.577 = $181 Mil.
Cash Flow from Operations was -50.48 + 85.052 + 117.797 + 2.283 = $155 Mil.
Revenue was 1298.284 + 911.478 + 925.884 + 895.484 = $4,031 Mil.
Gross Profit was 785.609 + 519.481 + 532.129 + 503.224 = $2,340 Mil.
Total Assets at the begining of this year (Jan13) was $4,631 Mil.
Total Assets was $4,752 Mil.
Long-Term Debt was $751 Mil.
Total Current Assets was $3,228 Mil.
Total Current Liabilities was $697 Mil.
Net Income was 179.643 + 63.179 + 91.801 + 81.534 = $416 Mil.

Revenue was 1235.769 + 852.741 + 886.569 + 819.17 = $3,794 Mil.
Gross Profit was 730.815 + 464.289 + 499.162 + 469.018 = $2,163 Mil.
Total Assets at the begining of last year (Jan12) was $4,159 Mil.
Total Assets was $4,631 Mil.
Long-Term Debt was $765 Mil.
Total Current Assets was $3,152 Mil.
Total Current Liabilities was $587 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.

Tiffany & Co.'s current net income was 181. ==> 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.

Tiffany & Co.'s current cash flow from operations was 155. ==> 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 (Jan13)
=181.369/4630.85
=0.03916538

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Jan12)
=416.157/4158.992
=0.10006199

Tiffany & Co.'s return on assets of this year was 0.03916538. Tiffany & Co.'s return on assets of last year was 0.10006199. ==> 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.

Tiffany & Co.'s current net income was 181. Tiffany & Co.'s current cash flow from operations was 155. ==> 155 =< 181 ==> 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 1 if gearing is lower, 0 if it’s higher.

Gearing (This Year)=Long-Term Debt/Total Assets
=751.154/4752.351
=0.15805945

Gearing (Last Year)=Long-Term Debt/Total Assets
=765.238/4630.85
=0.16524785

Tiffany & Co.'s gearing of this year was 0.15805945. Tiffany & Co.'s gearing of last year was 0.16524785. ==> 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
=3228.388/696.74
=4.63356202

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=3151.589/586.592
=5.3727105

Tiffany & Co.'s current ratio of this year was 4.63356202. Tiffany & Co.'s current ratio of last year was 5.3727105. ==> 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.

Tiffany & Co.'s number of shares in issue this year was 129.3. Tiffany & Co.'s number of shares in issue last year was 128. ==> 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
=2340.443/4031.13
=0.58059229

Gross Margin (Last Year)=Gross Profit/Revenue
=2163.284/3794.249
=0.57014814

Tiffany & Co.'s gross margin of this year was 0.58059229. Tiffany & Co.'s gross margin of last year was 0.57014814. ==> 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 (Jan13)
=4031.13/4630.85
=0.87049462

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Jan12)
=3794.249/4158.992
=0.91230014

Tiffany & Co.'s asset turnover of this year was 0.87049462. Tiffany & Co.'s asset turnover of last year was 0.91230014. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

Piotroski F-Score=Q1+Q2+Q3+Q4+Q5+Q6+Q7+Q8+Q9
=1+1+0+0+1+0+0+1+0
=4

Good or high score = 8 or 9

Bad or low score = 0 or 1

Tiffany & Co. 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.

Tiffany & Co. Annual Data

Jan05Jan06Jan07Jan08Jan09Jan10Jan11Jan12Jan13Jan14
Q1 1111111111
Q2 1111111111
Q3 1011011100
Q4 0101010000
Q5 1011000101
Q6 1100111010
Q7 1111110010
Q8 0110101001
Q9 0011001100
F-score 6677566544

Tiffany & Co. Quarterly Data

Oct11Jan12Apr12Jul12Oct12Jan13Apr13Jul13Oct13Jan14
Q1 1111111111
Q2 1111111111
Q3 1110000000
Q4 0000001110
Q5 1110000111
Q6 0001111000
Q7 0111110000
Q8 1000000011
Q9 1110000000
F-score 6664444450
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