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Piotroski F-score and DuPont decomposition from two years of statements (Apple fiscal 2023 and 2022)
| Tool | Financial Quality Scores |
| Source | Apple Inc. (2023). Form 10-K: Annual Report for the Fiscal Year Ended September 30, 2023. U.S. Securities and Exchange Commission, EDGAR accession 0000320193-23-000106, filed 3 November 2023. Consolidated statements of operations, balance sheets and statements of cash flows. Screens: Piotroski (2000), Altman (1968), Sloan (1996). |
| Level | Undergraduate |
Problem
From the fiscal 2023 and 2022 statements of a company (millions of dollars), work through the nine tests of the Piotroski F-score, split the return on equity of each year into profit margin, asset turnover and equity multiplier, and say which factor changed most. In Advanced mode, compute the Altman Z-score and the accruals ratio.
Inputs to Enter
- Fiscal 2023 / 2022: revenue 383,285 / 394,328; gross profit 169,148 / 170,782; net income 96,995 / 99,803; operating cash flow 110,543 / 122,151
- Total assets 352,583 / 352,755; current assets 143,566 / 135,405; current liabilities 145,308 / 153,982; long-term debt 95,281 / 98,959; equity 62,146 / 50,672; shares 15,550 / 15,943 million
- Advanced: operating income 114,301 / 119,437; pretax income 113,736 / 119,103; retained earnings −214; cash and current securities 61,555 / 48,304; short-term debt 15,807 / 21,110; depreciation 11,519; share price 175 (a round illustrative figure, not a quotation)
Answers
- ROA 27.51 % (positive: pass) against 28.29 % (did not rise: fail); cash return 31.35 % (positive: pass; above ROA: pass)
- Leverage 27.02 % against 28.05 % (pass); current ratio 0.988 against 0.879 (pass); shares 15,550 against 15,943 (pass); gross margin 44.13 % against 43.31 % (pass); asset turnover 1.087 against 1.118 (fail)
- F-score = 1 + 1 + 0 + 1 + 1 + 1 + 1 + 1 + 0 = 7 of 9
- DuPont: 25.306 % × 1.087 × 5.673 = 156.08 % return on equity; last year 25.310 % × 1.118 × 6.962 = 196.96 %; relative changes −0.01 %, −2.75 %, −18.50 % compound to −20.76 %, the largest in the equity multiplier
- Advanced: five-step factors 0.8528 × 0.9951 × 29.821 % × 1.087 × 5.673; Altman X = −0.0049, −0.0006, 0.3242, 9.3695, 1.0871 and Z = 7.772 (published boundaries 1.81 and 2.99); accruals ratio −3.84 % (cash-flow form) and −3.75 % (balance-sheet form)
Notes
The tool's default inputs are this case; press Submit. The statement figures are from the filing (the gross margins agree with the 44.1 % and 43.3 % it prints); the share price is illustrative. Each ratio uses the closing balance sheet of its year, a simplification of Piotroski's beginning-of-year scaling that the page states. The numbers are the tool's own calculation, checked against an independent numpy implementation; the scores are published screens built on other samples of companies and the page draws no conclusion about the company.