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Telefonica Brasil SA (NYSE:VIV)
Piotroski F-Score
6 (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

Telefonica Brasil SA has an F-score of 8. It is a good or high score, which usually indicates a very healthy situation.

VIV' s Piotroski F-Score Range Over the Past 10 Years
Min: 3   Max: 8
Current: 6

3
8

During the past 13 years, the highest Piotroski F-Score of Telefonica Brasil SA was 8. 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 local exchange's currency.

This Year (Sep16) TTM:Last Year (Sep15) TTM:
Net Income was 279.46531643 + 329.429421309 + 204.32902962 + 292.847042912 = $1,106 Mil.
Cash Flow from Operations was 1043.41630592 + 555.93996755 + 871.847286324 + 947.466187139 = $3,419 Mil.
Revenue was 2772.83858998 + 2820.82098432 + 3070.04732138 + 3287.02969384 = $11,951 Mil.
Gross Profit was 1392.19387755 + 1372.29691725 + 2034.030496 + 1666.17330628 = $6,465 Mil.
Average Total Assets from the begining of this year (Sep15)
to the end of this year (Sep16) was
(26185.6494671 + 26202.0882292 + 27378.3942672 + 29662.7799848 + 31264.0971966) / 5 = $28138.601829 Mil.
Total Assets at the begining of this year (Sep15) was $26,186 Mil.
Long-Term Debt was $1,576 Mil.
Total Current Assets was $5,667 Mil.
Total Current Liabilities was $6,276 Mil.
Net Income was 477.270146485 + 184.541605654 + 279.530803098 + 227.035509326 = $1,168 Mil.

Revenue was 3424.65649722 + 2859.57789521 + 3201.50560787 + 2710.79626973 = $12,197 Mil.
Gross Profit was 1915.13683334 + 1415.36830712 + 1572.66992319 + 1331.98350072 = $6,235 Mil.
Average Total Assets from the begining of last year (Sep14)
to the end of last year (Sep15) was
(30218.2142093 + 0 + 23135.6952314 + 32801.0916862 + 26185.6494671) / 5 = $22468.1301188 Mil.
Total Assets at the begining of last year (Sep14) was $30,218 Mil.
Long-Term Debt was $1,750 Mil.
Total Current Assets was $4,876 Mil.
Total Current Liabilities was $5,263 Mil.

Profitability

Question 1. 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.

Telefonica Brasil SA's current net income (TTM) was 1,106. ==> Positive ==> Score 1.

Question 2. 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.

Telefonica Brasil SA's current cash flow from operations (TTM) was 3,419. ==> Positive ==> Score 1.

Question 3. 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 (Sep15)
=1106.07081027/26185.6494671
=0.04223958

ROA (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Sep14)
=1168.37806456/30218.2142093
=0.0386647

Telefonica Brasil SA's return on assets of this year was 0.04223958. Telefonica Brasil SA's return on assets of last year was 0.0386647. ==> This year is higher. ==> Score 1.

Question 4. 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.

Telefonica Brasil SA's current net income (TTM) was 1,106. Telefonica Brasil SA's current cash flow from operations (TTM) was 3,419. ==> 3,419 > 1,106 ==> CFROA > ROA ==> Score 1.

Funding

Question 5. 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: Sep16)=Long-Term Debt/Average Total Assets from Sep15 to Sep16
=1576.45364564/28138.601829
=0.05602459

Gearing (Last Year: Sep15)=Long-Term Debt/Average Total Assets from Sep14 to Sep15
=1749.76941996/22468.1301188
=0.07787784

Telefonica Brasil SA's gearing of this year was 0.05602459. Telefonica Brasil SA's gearing of last year was 0.07787784. ==> This year is lower or equal to last year. ==> Score 1.

Question 6. 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: Sep16)=Total Current Assets/Total Current Liabilities
=5666.59811878/6275.99040944
=0.90290102

Current Ratio (Last Year: Sep15)=Total Current Assets/Total Current Liabilities
=4876.2630662/5263.30164993
=0.92646468

Telefonica Brasil SA's current ratio of this year was 0.90290102. Telefonica Brasil SA's current ratio of last year was 0.92646468. ==> Last year's current ratio is higher ==> Score 0.

Question 7. 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.

Telefonica Brasil SA's number of shares in issue this year was 1688.7. Telefonica Brasil SA's number of shares in issue last year was 1688.7. ==> There is smaller number of shares in issue this year, or the same. ==> Score 1.

Efficiency

Question 8. 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
=6464.69459708/11950.7365895
=0.54094528

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=6235.15856437/12196.53627
=0.51122371

Telefonica Brasil SA's gross margin of this year was 0.54094528. Telefonica Brasil SA's gross margin of last year was 0.51122371. ==> This year's gross margin is higher. ==> Score 1.

Question 9. 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 (Sep15)
=11950.7365895/26185.6494671
=0.45638496

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Sep14)
=12196.53627/30218.2142093
=0.40361539

Telefonica Brasil SA's asset turnover of this year was 0.45638496. Telefonica Brasil SA's asset turnover of last year was 0.40361539. ==> This year's asset turnover is higher. ==> Score 1.

Evaluation

Piotroski F-Score= Que. 1+ Que. 2+ Que. 3+Que. 4+Que. 5+Que. 6+Que. 7+Que. 8+Que. 9
=1+1+1+1+1+0+1+1+1
=8

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

Telefonica Brasil SA 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 local exchange's currency.

Telefonica Brasil SA Annual Data

Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Question 1 11111111
Question 2 00111111
Question 3 10010100
Question 4 00111111
Question 5 10111010
Question 6 01100110
Question 7 01111001
Question 8 10010110
Question 9 01010100
F-score 44685764

Telefonica Brasil SA Quarterly Data

Jun14Sep14Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16
Question 1 11111111
Question 2 11111111
Question 3 01100001
Question 4 11111111
Question 5 11101111
Question 6 00000110
Question 7 11100001
Question 8 11100011
Question 9 00100101
F-score 67834668
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