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United Continental Holdings Inc (NYSE:UAL)
Piotroski F-Score
7 (As of Today)

Good Sign:

Piotroski F-Score of 7 is 7, 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

United Continental Holdings Inc has an F-score of 7 indicating the company's financial situation is typical for a stable company.

UAL' s 10-Year Piotroski F-Score Range
Min: 1   Max: 7
Current: 7

1
7

During the past 13 years, the highest Piotroski F-Score of United Continental Holdings Inc was 7. The lowest was 1. 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 140 + 379 + 469 + -417 = $571 Mil.
Cash Flow from Operations was -334 + 237 + 1148 + 393 = $1,444 Mil.
Revenue was 9329 + 10228 + 10001 + 8721 = $38,279 Mil.
Gross Profit was 4805 + 5333 + 6933 + 5671 = $22,742 Mil.
Total Assets at the begining of this year (Dec12) was $37,628 Mil.
Total Assets was $36,812 Mil.
Long-Term Debt was $10,924 Mil.
Total Current Assets was $8,702 Mil.
Total Current Liabilities was $12,107 Mil.
Net Income was -620 + 6 + 339 + -448 = $-723 Mil.

Revenue was 8702 + 9909 + 9939 + 8602 = $37,152 Mil.
Gross Profit was 4119 + 4902 + 6531 + 5373 = $20,925 Mil.
Total Assets at the begining of last year (Dec11) was $37,988 Mil.
Total Assets was $37,628 Mil.
Long-Term Debt was $11,232 Mil.
Total Current Assets was $10,049 Mil.
Total Current Liabilities was $12,818 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.

United Continental Holdings Inc's current net income was 571. ==> 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.

United Continental Holdings Inc's current cash flow from operations was 1,444. ==> 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)
=571/37628
=0.01517487

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=-723/37988
=-0.01903233

United Continental Holdings Inc's return on assets of this year was 0.01517487. United Continental Holdings Inc's return on assets of last year was -0.01903233. ==> 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.

United Continental Holdings Inc's current net income was 571. United Continental Holdings Inc's current cash flow from operations was 1,444. ==> 1,444 > 571 ==> 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
=10924/36812
=0.29675106

Gearing (Last Year)=Long-Term Debt/Total Assets
=11232/37628
=0.29850112

United Continental Holdings Inc's gearing of this year was 0.29675106. United Continental Holdings Inc's gearing of last year was 0.29850112. ==> 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
=8702/12107
=0.71875774

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=10049/12818
=0.78397566

United Continental Holdings Inc's current ratio of this year was 0.71875774. United Continental Holdings Inc's current ratio of last year was 0.78397566. ==> 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.

United Continental Holdings Inc's number of shares in issue this year was 390. United Continental Holdings Inc's number of shares in issue last year was 331. ==> 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
=22742/38279
=0.59411165

Gross Margin (Last Year)=Gross Profit/Revenue
=20925/37152
=0.56322674

United Continental Holdings Inc's gross margin of this year was 0.59411165. United Continental Holdings Inc's gross margin of last year was 0.56322674. ==> 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)
=38279/37628
=1.01730095

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=37152/37988
=0.97799305

United Continental Holdings Inc's asset turnover of this year was 1.01730095. United Continental Holdings Inc's asset turnover of last year was 0.97799305. ==> 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+1+0+0+1+1
=7

Good or high score = 8 or 9

Bad or low score = 0 or 1

United Continental Holdings Inc has an F-score of 7 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.

United Continental Holdings Inc Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 0011001101
Q2 1111011111
Q3 1010011101
Q4 1101111111
Q5 0001001111
Q6 0100011100
Q7 0000100010
Q8 1110010011
Q9 1110111011
F-score 5554367667

United Continental Holdings Inc Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 1111000001
Q2 1111111111
Q3 1110000011
Q4 1111111111
Q5 1111110001
Q6 1100000000
Q7 0001110000
Q8 0001011111
Q9 1000011111
F-score 7656464457
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