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Cisco Systems (XSGO:CSCO) Piotroski F-Score

: 8 (As of Today)
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Good Sign:

Piotroski F-Score is 8, indicates a very healthy situation.

The zones of discrimination were as such:

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

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

The historical rank and industry rank for Cisco Systems's Piotroski F-Score or its related term are showing as below:

XSGO:CSCO' s Piotroski F-Score Range Over the Past 10 Years
Min: 4   Med: 7   Max: 9
Current: 8

During the past 13 years, the highest Piotroski F-Score of Cisco Systems was 9. The lowest was 4. And the median was 7.


Cisco Systems Piotroski F-Score Historical Data

The historical data trend for Cisco Systems'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.

* Premium members only.

Cisco Systems Annual Data
Trend Jul14 Jul15 Jul16 Jul17 Jul18 Jul19 Jul20 Jul21 Jul22 Jul23
Piotroski F-Score
Premium Member Only Premium Member Only Premium Member Only Premium Member Only Premium Member Only 8.00 9.00 6.00 7.00 8.00

Cisco Systems Quarterly Data
Apr19 Jul19 Oct19 Jan20 Apr20 Jul20 Oct20 Jan21 Apr21 Jul21 Oct21 Jan22 Apr22 Jul22 Oct22 Jan23 Apr23 Jul23 Oct23 Jan24
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 6.00 6.00 8.00 9.00 8.00

Competitive Comparison

For the Communication Equipment subindustry, Cisco Systems's Piotroski F-Score, along with its competitors' market caps and Piotroski F-Score data, can be viewed below:

* 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. Note that "N/A" values will not show up in the chart.


Cisco Systems Piotroski F-Score Distribution

For the Hardware industry and Technology sector, Cisco Systems's Piotroski F-Score distribution charts can be found below:

* The bar in red indicates where Cisco Systems's Piotroski F-Score falls into.


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 (Jan24) TTM:Last Year (Jan23) TTM:
Net Income was 3212 + 3958 + 3638 + 2634 = $13,442 Mil.
Cash Flow from Operations was 5219 + 5966 + 2371 + 808 = $14,364 Mil.
Revenue was 14571 + 15203 + 14668 + 12791 = $57,233 Mil.
Gross Profit was 9232 + 9748 + 9557 + 8217 = $36,754 Mil.
Average Total Assets from the begining of this year (Jan23)
to the end of this year (Jan24) was
(95840 + 97529 + 101852 + 98782 + 101174) / 5 = $99035.4 Mil.
Total Assets at the begining of this year (Jan23) was $95,840 Mil.
Long-Term Debt & Capital Lease Obligation was $6,669 Mil.
Total Current Assets was $42,127 Mil.
Total Current Liabilities was $30,851 Mil.
Net Income was 3044 + 2815 + 2670 + 2773 = $11,302 Mil.

Revenue was 12835 + 13102 + 13632 + 13592 = $53,161 Mil.
Gross Profit was 8121 + 8025 + 8346 + 8427 = $32,919 Mil.
Average Total Assets from the begining of last year (Jan22)
to the end of last year (Jan23) was
(94262 + 92797 + 94002 + 93054 + 95840) / 5 = $93991 Mil.
Total Assets at the begining of last year (Jan22) was $94,262 Mil.
Long-Term Debt & Capital Lease Obligation was $7,637 Mil.
Total Current Assets was $38,515 Mil.
Total Current Liabilities was $27,252 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.

Cisco Systems's current Net Income (TTM) was 13,442. ==> 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.

Cisco Systems's current Cash Flow from Operations (TTM) was 14,364. ==> 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 (Jan23)
=13442/95840
=0.14025459

ROA (Last Year)=Net Income/Total Assets (Jan22)
=11302/94262
=0.11989985

Cisco Systems's return on assets of this year was 0.14025459. Cisco Systems's return on assets of last year was 0.11989985. ==> 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.

Cisco Systems's current Net Income (TTM) was 13,442. Cisco Systems's current Cash Flow from Operations (TTM) was 14,364. ==> 14,364 > 13,442 ==> 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: Jan24)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Jan23 to Jan24
=6669/99035.4
=0.06733956

Gearing (Last Year: Jan23)=Long-Term Debt & Capital Lease Obligation/Average Total Assets from Jan22 to Jan23
=7637/93991
=0.08125246

Cisco Systems's gearing of this year was 0.06733956. Cisco Systems's gearing of last year was 0.08125246. ==> 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: Jan24)=Total Current Assets/Total Current Liabilities
=42127/30851
=1.36549869

Current Ratio (Last Year: Jan23)=Total Current Assets/Total Current Liabilities
=38515/27252
=1.41329077

Cisco Systems's current ratio of this year was 1.36549869. Cisco Systems's current ratio of last year was 1.41329077. ==> 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.

Cisco Systems's number of shares in issue this year was 4073. Cisco Systems's number of shares in issue last year was 4116. ==> 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
=36754/57233
=0.64218196

Gross Margin (Last Year: TTM)=Gross Profit/Revenue
=32919/53161
=0.61923214

Cisco Systems's gross margin of this year was 0.64218196. Cisco Systems's gross margin of last year was 0.61923214. ==> 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 (Jan23)
=57233/95840
=0.59717237

Asset Turnover (Last Year)=Revenue/Total Assets at the Beginning of Last Year (Jan22)
=53161/94262
=0.56397064

Cisco Systems's asset turnover of this year was 0.59717237. Cisco Systems's asset turnover of last year was 0.56397064. ==> 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

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

Cisco Systems  (XSGO:CSCO) 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.


Cisco Systems Piotroski F-Score Related Terms

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Cisco Systems (XSGO:CSCO) Business Description

Address
170 West Tasman Drive, San Jose, CA, USA, 95134-1706
Cisco Systems is the largest provider of networking equipment in the world and one of the largest software companies in the world. Its largest businesses are selling networking hardware and software (where it has leading market shares) and cybersecurity software like firewalls. It also has collaboration products, like its Webex suite, and observability tools. It primarily outsources its manufacturing to third parties and has a large sales and marketing staff—25,000 strong across 90 countries. Overall, Cisco employees 80,000 employees and sells its products globally.