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The zones of discrimination were as such:
Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3
Covanta Holding has an F-score of 7. It is a good or high score, which usually indicates a very healthy situation.
The historical rank and industry rank for Covanta Holding's Piotroski F-Score or its related term are showing as below:
The historical data trend for Covanta Holding's Piotroski F-Score can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Covanta Holding Annual Data | |||||||||||||||||||||
Trend | Dec11 | Dec12 | Dec13 | Dec14 | Dec15 | Dec16 | Dec17 | Dec18 | Dec19 | Dec20 | |||||||||||
Piotroski F-Score | Get a 7-Day Free Trial | 4.00 | 6.00 | 8.00 | 5.00 | 4.00 |
Covanta Holding Quarterly Data | ||||||||||||||||||||
Dec16 | Mar17 | Jun17 | Sep17 | Dec17 | Mar18 | Jun18 | Sep18 | Dec18 | Mar19 | Jun19 | Sep19 | Dec19 | Mar20 | Jun20 | Sep20 | Dec20 | Mar21 | Jun21 | Sep21 | |
Piotroski F-Score | Get a 7-Day Free Trial | 3.00 | 4.00 | 5.00 | 4.00 | 7.00 |
How is the Piotroski F-Score calculated?
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD.
* For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
This Year (Sep21) TTM: | Last Year (Sep20) TTM: |
Net Income was 12 + 2 + -19 + 30 = $25 Mil. Cash Flow from Operations was 63 + 52 + 105 + 90 = $310 Mil. Revenue was 491 + 498 + 506 + 539 = $2,034 Mil. Gross Profit was 151 + 100 + 116 + 173 = $540 Mil. Average Total Assets from the begining of this year (Sep20) to the end of this year (Sep21) was (3656 + 3706 + 3642 + 3627 + 3598) / 5 = $3645.8 Mil. Total Assets at the begining of this year (Sep20) was $3,656 Mil. Long-Term Debt & Capital Lease Obligation was $2,447 Mil. Total Current Assets was $399 Mil. Total Current Liabilities was $448 Mil. |
Net Income was 12 + -32 + -13 + 5 = $-28 Mil. Revenue was 485 + 468 + 454 + 491 = $1,898 Mil. Gross Profit was 152 + 97 + 103 + 133 = $485 Mil. Average Total Assets from the begining of last year (Sep19) to the end of last year (Sep20) was (3798 + 3715 + 3669 + 3656 + 3656) / 5 = $3698.8 Mil. Total Assets at the begining of last year (Sep19) was $3,798 Mil. Long-Term Debt & Capital Lease Obligation was $2,535 Mil. Total Current Assets was $386 Mil. Total Current Liabilities was $347 Mil. |
*Note: If the latest quarterly/semi-annual/annual total assets data is 0, then we will use previous quarterly/semi-annual/annual data for all the items in the balance sheet.
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.
Covanta Holding's current Net Income (TTM) was 25.
==> 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.
Covanta Holding's current Cash Flow from Operations (TTM) was 310.
==> 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 | / | Total Assets (Sep20) |
= | 25 | / | 3656 | |
= | 0.00683807 |
ROA (Last Year) | = | Net Income | / | Total Assets (Sep19) |
= | -28 | / | 3798 | |
= | -0.0073723 |
Covanta Holding's return on assets of this year was 0.00683807. Covanta Holding's return on assets of last year was -0.0073723.
==> 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.
Covanta Holding's current Net Income (TTM) was 25. Covanta Holding's current Cash Flow from Operations (TTM) was 310.
==> 310 > 25 ==> 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: Sep21) | = | Long-Term Debt & Capital Lease Obligation | / | Average Total Assets from Sep20 to Sep21 |
= | 2447 | / | 3645.8 | |
= | 0.67118328 |
Gearing (Last Year: Sep20) | = | Long-Term Debt & Capital Lease Obligation | / | Average Total Assets from Sep19 to Sep20 |
= | 2535 | / | 3698.8 | |
= | 0.68535741 |
Covanta Holding's gearing of this year was 0.67118328. Covanta Holding's gearing of last year was 0.68535741.
==> 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: Sep21) | = | Total Current Assets | / | Total Current Liabilities |
= | 399 | / | 448 | |
= | 0.890625 |
Current Ratio (Last Year: Sep20) | = | Total Current Assets | / | Total Current Liabilities |
= | 386 | / | 347 | |
= | 1.11239193 |
Covanta Holding's current ratio of this year was 0.890625. Covanta Holding's current ratio of last year was 1.11239193.
==> 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.
Covanta Holding's number of shares in issue this year was 138. Covanta Holding's number of shares in issue last year was 134.
==> 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 |
= | 540 | / | 2034 | |
= | 0.26548673 |
Gross Margin (Last Year: TTM) | = | Gross Profit | / | Revenue |
= | 485 | / | 1898 | |
= | 0.25553214 |
Covanta Holding's gross margin of this year was 0.26548673. Covanta Holding's gross margin of last year was 0.25553214.
==> 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 | / | Total Assets at the Beginning of This Year (Sep20) |
= | 2034 | / | 3656 | |
= | 0.55634573 |
Asset Turnover (Last Year) | = | Revenue | / | Total Assets at the Beginning of Last Year (Sep19) |
= | 1898 | / | 3798 | |
= | 0.4997367 |
Covanta Holding's asset turnover of this year was 0.55634573. Covanta Holding's asset turnover of last year was 0.4997367.
==> 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 | + | 0 | + | 1 | + | 1 | |
= | 7 |
Good or high score = 7, 8, 9
Bad or low score = 0, 1, 2, 3
Covanta Holding has an F-score of 7. It is a good or high score, which usually indicates a very healthy situation.
Covanta Holding (NYSE:CVA) Piotroski F-Score 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.
Thank you for viewing the detailed overview of Covanta Holding's Piotroski F-Score provided by GuruFocus.com. Please click on the following links to see related term pages.
Paul E. Stauder | officer: President, Covanta Envir. Sol. | 445 SOUTH STREET MORRISTOWN NJ 07960 |
Thomas L Kenyon | officer: Exec. VP, Gen'l Counsel & Sec. | 445 SOUTH STREET MORRISTOWN NJ 07960 |
Ronald J Broglio | director | 1417 HIGH ROAD VANDIVER AL 35176 |
Schantz Joseph J Ii | officer: Chief Accounting Officer | 445 SOUTH STREET MORRISTOWN NJ 07960 |
Robert S Silberman | director | C/O STRAYER EDUCATION INC, 2303 DULLES STATION BOULEVARD, HERNDON VA 20171 |
Linda J. Fisher | director | WILMINGTION OFFICE BUILDINGS 1007 MARKET STREET, D-6074 WILMINGTON DE 19898 |
De Castro Michael Joseph | officer: EVP Supply Chain | 445 SOUTH STREET MORRISTOWN NJ 07960 |
Timothy Simpson | officer: Exec. VP, Gen'l Counsel & Sec. | 40 LANE ROAD FAIRFIELD NJ 07004 |
Matthew Mulcahy | officer: SVP & Head of Corp Development | 445 SOUTH STREET MORRISTOWN NJ 07960 |
Owen Michaelson | director | 3 BRADFIELD WAY WAVERLEY ROTHERHAM X0 S60 5WE |
Virginia D. Angilello | officer: SVP & CHRO | 445 SOUTH STREET COVANTA MORRISTOWN NJ 07960 |
Stephen J Jones | officer: President and CEO | 7201 HAMILTON BOULEVARD, ALLENTOWN PA 18195-1501 |
Danielle Pletka | director | 1789 MASSACHUSETTS AVENUE, NW WASHINGTON, DC DC 20036 |
Michael W Ranger | director | C/O TXU CORP, 1601 BRYAN ST, DALLAS TX 75201 |
Manpreet Grewal | officer: VP & Chief Accounting Officer | 600 GRANT STREET, PITTSBURGH PA 15219 |
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