Run a Checklist

What does Piotroski F-Score mean?

The F-score is a set of nine accounting-based stock selection criteria which aims to identify the healthiest companies amongst a basket of value stocks. In summary, the nine metrics are: i) Net Income, ii) Operating Cash Flow, iii) Return on Assets Ð Score 1 if the ROA is higher in the current period compared to the previous year, iv) Quality of Earnings, v) Decrease in Leverage, vi) Increase in Liquidity, vii) Absence of Dilution, viii) Gross Margin and ix) Asset Turnover.

What does P/E mean?

The Price to Earnings Ratio (also called the PE ratio) is the primary valuation ratio used by most equity investors. It is a measure of the price paid for a share relative to the annual net income or profit earned by the firm per share.A hig P/E ratio means that investors are paying more for each unit of net income, so the stock is more expensive compared to one with a lower P/E ratio. The P/E ratio can be seen as being expressed in years, in the sense that it shows the number of years of earnings which would be required to pay back the purchase price, ignoring inflation. Unlike the EV/EBITDA multiple which is capital structure-neutral, the price-to-earnings ratio reflects the capital structure of the company in question. The reciprocal of the P/E ratio is known as the earnings yield.

Stockopedia explains P/E...

This is is the primary valuation ratio used by most equity investors. A high P/E ratio means that investors are paying more for each unit of net income, so the stock is more expensive compared to one with a lower P/E ratio. The P/E ratio can be seen as being expressed in years, in the sense that it shows the number of years of earnings which would be required to pay back the purchase price, ignoring inflation.

Unlike the EV/EBITDA multiple which is capital structure-neutral, the price-to-earnings ratio reflects the capital structure of the company in question