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Penske Automotive Group Piotroski F-Score

: 6 (As of Today)
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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

Penske Automotive Group has an F-score of 6 indicating the company's financial situation is typical for a stable company.

NYSE:PAG' s Piotroski F-Score Range Over the Past 10 Years
Min: 1   Max: 8
Current: 6

1
8

During the past 13 years, the highest Piotroski F-Score of Penske Automotive Group was 8. The lowest was 1. And the median was 6.


Penske Automotive Group Piotroski F-Score Historical Data

* All numbers are in millions except for per share data and ratio. All numbers are in their local exchange's currency.

* Premium members only.

Penske Automotive Group Annual Data

Dec09 Dec10 Dec11 Dec12 Dec13 Dec14 Dec15 Dec16 Dec17 Dec18
Piotroski F-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 5.00 6.00 5.00 6.00 6.00

Penske Automotive Group Quarterly Data

Jun14 Sep14 Dec14 Mar15 Jun15 Sep15 Dec15 Mar16 Jun16 Sep16 Dec16 Mar17 Jun17 Sep17 Dec17 Mar18 Jun18 Sep18 Dec18 Mar19
Piotroski F-Score Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 5.00 7.00 5.00 6.00 6.00

Competitive Comparison
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap.


Penske Automotive Group Piotroski F-Score Distribution

* The bar in red indicates where Penske Automotive Group's Piotroski F-Score falls into.


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 (Mar19) TTM:Last Year (Mar18) TTM:
Net Income was 134.6 + 130.2 + 98.1 + 100.2 = $463 Mil.
Cash Flow from Operations was 242.3 + 119 + 78.5 + 91.3 = $531 Mil.
Revenue was 5940.3 + 5658.6 + 5439.3 + 5564.4 = $22,603 Mil.
Gross Profit was 889.8 + 852.6 + 808.1 + 851.5 = $3,402 Mil.
Average Total Assets from the begining of this year (Mar18)
to the end of this year (Mar19) was
(10843 + 10570.5 + 10526.9 + 10904.5 + 13574.9) / 5 = $11283.96 Mil.
Total Assets at the begining of this year (Mar18) was $10,843 Mil.
Long-Term Debt & Capital Lease Obligation was $2,118 Mil.
Total Current Assets was $5,283 Mil.
Total Current Liabilities was $5,376 Mil.
Net Income was 106.2 + 94.4 + 330.1 + 108.1 = $639 Mil.

Revenue was 5383.4 + 5524.4 + 5398 + 5746.9 = $22,053 Mil.
Gross Profit was 817.3 + 822.6 + 808.3 + 864.4 = $3,313 Mil.
Average Net Income from the begining of last year (Mar17)
to the end of last year (Mar18) was
(9395.4 + 9711.9 + 10282.3 + 10540.6 + 10843) / 5 = $10154.64 Mil.
Total Assets at the begining of last year (Mar17) was $9,395 Mil.
Long-Term Debt & Capital Lease Obligation was $2,137 Mil.
Total Current Assets was $5,165 Mil.
Total Current Liabilities was $5,139 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.

Penske Automotive Group's current Net Income (TTM) was 463. ==> 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.

Penske Automotive Group's current Cash Flow from Operations (TTM) was 531. ==> 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(Mar18)
=463.1/10843
=0.04270958

ROA (Last Year)=Net Income/Total Assets(Mar17)
=638.8/9395.4
=0.06799072

Penske Automotive Group's return on assets of this year was 0.04270958. Penske Automotive Group's return on assets of last year was 0.06799072. ==> Last year is higher ==> Score 0.

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.

Penske Automotive Group's current Net Income (TTM) was 463. Penske Automotive Group's current Cash Flow from Operations (TTM) was 531. ==> 531 > 463 ==> 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: Mar19)=Long-Term Debt & Capital Lease Obligation/Total Assetsfrom Mar18 to Mar19
=2118.3/11283.96
=0.18772665

Gearing (Last Year: Mar18)=Long-Term Debt & Capital Lease Obligation/Total Assetsfrom Mar17 to Mar18
=2136.9/10154.64
=0.21043582

Penske Automotive Group's gearing of this year was 0.18772665. Penske Automotive Group's gearing of last year was 0.21043582. ==> 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: Mar19)=Total Current Assets/Total Current Liabilities
=5283.2/5376.1
=0.98271982

Current Ratio (Last Year: Mar18)=Total Current Assets/Total Current Liabilities
=5165.4/5138.8
=1.00517631

Penske Automotive Group's current ratio of this year was 0.98271982. Penske Automotive Group's current ratio of last year was 1.00517631. ==> 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.

Penske Automotive Group's number of shares in issue this year was 84.4. Penske Automotive Group's number of shares in issue last year was 86. ==> 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
=3402/22602.6
=0.15051366

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=3312.6/22052.7
=0.1502129

Penske Automotive Group's gross margin of this year was 0.15051366. Penske Automotive Group's gross margin of last year was 0.1502129. ==> 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 (Mar18)
=22602.6/10843
=2.0845338

Asset Turnover (Last Year)=Revenue/Total Assets at the Beginning of Last Year (Mar17)
=22052.7/9395.4
=2.34718054

Penske Automotive Group's asset turnover of this year was 2.0845338. Penske Automotive Group's asset turnover of last year was 2.34718054. ==> Last year's asset turnover is higher ==> Score 0.

Evaluation

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

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

Penske Automotive Group has an F-score of 6 indicating the company's financial situation is typical for a stable company.

Penske Automotive Group  (NYSE:PAG) 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.


Penske Automotive Group Piotroski F-Score Explanation


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