Switch to:
Valero Energy Corporation (NYSE:VLO)
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

Valero Energy Corporation has an F-score of 7 indicating the company's financial situation is typical for a stable company.

VLO' s 10-Year Piotroski F-Score Range
Min: 2   Max: 8
Current: 7

2
8

During the past 13 years, the highest Piotroski F-Score of Valero Energy Corporation 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 1288 + 312 + 466 + 654 = $2,720 Mil.
Cash Flow from Operations was 2529 + 221 + 1265 + 1549 = $5,564 Mil.
Revenue was 34429 + 36137 + 34034 + 33474 = $138,074 Mil.
Gross Profit was 2178 + 1150 + 2511 + 1667 = $7,506 Mil.
Total Assets at the begining of this year (Dec12) was $44,477 Mil.
Total Assets was $47,260 Mil.
Long-Term Debt was $6,261 Mil.
Total Current Assets was $19,277 Mil.
Total Current Liabilities was $13,123 Mil.
Net Income was 1010 + 674 + 831 + -432 = $2,083 Mil.

Revenue was 34695 + 34726 + 34662 + 35167 = $139,250 Mil.
Gross Profit was 2233 + 2230 + 3041 + 915 = $8,419 Mil.
Total Assets at the begining of last year (Dec11) was $42,783 Mil.
Total Assets was $44,477 Mil.
Long-Term Debt was $6,463 Mil.
Total Current Assets was $16,460 Mil.
Total Current Liabilities was $11,929 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.

Valero Energy Corporation's current net income was 2,720. ==> 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.

Valero Energy Corporation's current cash flow from operations was 5,564. ==> 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)
=2720/44477
=0.0611552

ROA (Last Year)=Net Income/Total Assets at the beginning of last year (Dec11)
=2083/42783
=0.04868756

Valero Energy Corporation's return on assets of this year was 0.0611552. Valero Energy Corporation's return on assets of last year was 0.04868756. ==> 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.

Valero Energy Corporation's current net income was 2,720. Valero Energy Corporation's current cash flow from operations was 5,564. ==> 5,564 > 2,720 ==> 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
=6261/47260
=0.1324799

Gearing (Last Year)=Long-Term Debt/Total Assets
=6463/44477
=0.14531106

Valero Energy Corporation's gearing of this year was 0.1324799. Valero Energy Corporation's gearing of last year was 0.14531106. ==> 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
=19277/13123
=1.46894765

Current Ratio (Last Year)=Total Current Assets/Total Current Liabilities
=16460/11929
=1.37983066

Valero Energy Corporation's current ratio of this year was 1.46894765. Valero Energy Corporation's current ratio of last year was 1.37983066. ==> 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.

Valero Energy Corporation's number of shares in issue this year was 545. Valero Energy Corporation's number of shares in issue last year was 556. ==> 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
=7506/138074
=0.05436215

Gross Margin (Last Year)=Gross Profit/Revenue
=8419/139250
=0.06045961

Valero Energy Corporation's gross margin of this year was 0.05436215. Valero Energy Corporation's gross margin of last year was 0.06045961. ==> Last year's gross margin is higher ==> Score 0.

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)
=138074/44477
=3.10439103

Asset Turnover (Last Year)=Revenue/Total Assets at the beginning of last year (Dec11)
=139250/42783
=3.25479747

Valero Energy Corporation's asset turnover of this year was 3.10439103. Valero Energy Corporation's asset turnover of last year was 3.25479747. ==> 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+0+0
=7

Good or high score = 8 or 9

Bad or low score = 0 or 1

Valero Energy Corporation 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.

Valero Energy Corporation Annual Data

Dec04Dec05Dec06Dec07Dec08Dec09Dec10Dec11Dec12Dec13
Q1 1111001111
Q2 1111111111
Q3 1100001101
Q4 1111111111
Q5 1110001111
Q6 0010101011
Q7 0001100011
Q8 1110001010
Q9 1100101100
F-score 7764528677

Valero Energy Corporation Quarterly Data

Sep11Dec11Mar12Jun12Sep12Dec12Mar13Jun13Sep13Dec13
Q1 1111111111
Q2 1111111111
Q3 1111001111
Q4 1111111111
Q5 1111111111
Q6 0000011111
Q7 0111110111
Q8 1001011110
Q9 1111100000
F-score 7778677887
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