Switch to:
GuruFocus has detected 2 Warning Signs with Newfield Exploration Co $NFX.
More than 500,000 people have already joined GuruFocus to track the stocks they follow and exchange investment ideas.
Newfield Exploration Co (NYSE:NFX)
Piotroski F-Score
5 (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

Newfield Exploration Co has an F-score of 5 indicating the company's financial situation is typical for a stable company.

NFX' s Piotroski F-Score Range Over the Past 10 Years
Min: 2   Max: 8
Current: 5

2
8

During the past 13 years, the highest Piotroski F-Score of Newfield Exploration Co was 8. The lowest was 2. And the median was 5.


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 (Mar17) TTM:Last Year (Mar16) TTM:
Net Income was -667 + 48 + 13 + 147 = $-459 Mil.
Cash Flow from Operations was 306 + 209 + 239 + 167 = $921 Mil.
Revenue was 381 + 392 + 415 + 417 = $1,605 Mil.
Gross Profit was 242 + 248 + 274 + 275 = $1,039 Mil.
Average Total Assets from the begining of this year (Mar16)
to the end of this year (Mar17) was
(4777 + 4285 + 4213 + 4312 + 4388) / 5 = $4395 Mil.
Total Assets at the begining of this year (Mar16) was $4,777 Mil.
Long-Term Debt was $2,432 Mil.
Total Current Assets was $865 Mil.
Total Current Liabilities was $583 Mil.
Net Income was -992 + -1227 + -663 + -624 = $-3,506 Mil.

Revenue was 469 + 377 + 362 + 284 = $1,492 Mil.
Gross Profit was 327 + 241 + 234 + 150 = $952 Mil.
Average Total Assets from the begining of last year (Mar15)
to the end of last year (Mar16) was
(9678 + 7458 + 5513 + 4768 + 4777) / 5 = $6438.8 Mil.
Total Assets at the begining of last year (Mar15) was $9,678 Mil.
Long-Term Debt was $2,429 Mil.
Total Current Assets was $1,088 Mil.
Total Current Liabilities was $525 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.

Newfield Exploration Co's current net income (TTM) was -459. ==> Negative ==> Score 0.

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.

Newfield Exploration Co's current cash flow from operations (TTM) was 921. ==> 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 (Last Year)=Net Income (TTM)/Total Assets at the Beginning of Last Year (Mar15)
=-3506/9678
=-0.36226493

Newfield Exploration Co's return on assets of this year was -0.09608541. Newfield Exploration Co's return on assets of last year was -0.36226493. ==> 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.

Newfield Exploration Co's current net income (TTM) was -459. Newfield Exploration Co's current cash flow from operations (TTM) was 921. ==> 921 > -459 ==> 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: Mar17)=Long-Term Debt/Average Total Assets from Mar16 to Mar17
=2432/4395
=0.55335609

Gearing (Last Year: Mar16)=Long-Term Debt/Average Total Assets from Mar15 to Mar16
=2429/6438.8
=0.37724421

Newfield Exploration Co's gearing of this year was 0.55335609. Newfield Exploration Co's gearing of last year was 0.37724421. ==> Last year is lower than this year ==> Score 0.

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: Mar17)=Total Current Assets/Total Current Liabilities
=865/583
=1.48370497

Current Ratio (Last Year: Mar16)=Total Current Assets/Total Current Liabilities
=1088/525
=2.07238095

Newfield Exploration Co's current ratio of this year was 1.48370497. Newfield Exploration Co's current ratio of last year was 2.07238095. ==> 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.

Newfield Exploration Co's number of shares in issue this year was 200. Newfield Exploration Co's number of shares in issue last year was 177. ==> There is larger number of shares in issue this year. ==> Score 0.

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
=1039/1605
=0.64735202

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=952/1492
=0.63806971

Newfield Exploration Co's gross margin of this year was 0.64735202. Newfield Exploration Co's gross margin of last year was 0.63806971. ==> 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 (Mar16)
=1605/4777
=0.33598493

Asset Turnover (Last Year)=Revenue (TTM)/Total Assets at the Beginning of Last Year (Mar15)
=1492/9678
=0.15416408

Newfield Exploration Co's asset turnover of this year was 0.33598493. Newfield Exploration Co's asset turnover of last year was 0.15416408. ==> 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
=0+1+1+1+0+0+0+1+1
=5

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

Newfield Exploration Co has an F-score of 5 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 local exchange's currency.

Newfield Exploration Co Annual Data

Dec07Dec08Dec09Dec10Dec11Dec12Dec13Dec14Dec15Dec16
Question 1 1001101100
Question 2 1111111111
Question 3 0001001101
Question 4 1111111111
Question 5 1000010100
Question 6 1100110111
Question 7 0100001000
Question 8 0000010100
Question 9 0101001101
F-score 5525456835

Newfield Exploration Co Quarterly Data

Dec14Mar15Jun15Sep15Dec15Mar16Jun16Sep16Dec16Mar17
Question 1 1100000000
Question 2 1111111111
Question 3 1000000011
Question 4 1111111111
Question 5 1111000000
Question 6 1110110110
Question 7 0000000000
Question 8 1000000101
Question 9 1000000111
F-score 8543332555
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)

GF Chat

{{numOfNotice}}
FEEDBACK