Last update on 2024-06-07

PerkinElmer (PKI) - Piotroski F-Score Analysis for Year 2023 (Final Score: 8/9)

Discover PerkinElmer (PKI) 2023 Piotroski F-Score analysis with a strong score of 8 out of 9, showcasing financial stability and operational efficiency.

Short Analysis - Piotroski Score: 8

We're running PerkinElmer (PKI) against the Piotroski 9-criteria scoring system to assess profitability, liquidity, and operating efficiency:

The Piotroski F-Score is a way to measure how strong a company's finances are on a scale of 0 to 9. A higher score means a stronger financial position. PerkinElmer (PKI) got an 8, indicating strong financial health. This score is based on 9 criteria, including profitability, liquidity, and operating efficiency. For profitability, PKI scores positively on net income, cash flow, and return on assets (ROA), though there is a concern that their ROA is lower than the industry average. In terms of liquidity, PKI has a mixed performance: its leverage is about average, but its current ratio, showing the ability to pay short-term debts, has significantly worsened. For operating efficiency, PKI shines with positive indicators in gross margin and asset turnover ratio. Lastly, the number of shares has slightly decreased, which is also positive. Overall, the company shows strong but not perfect financial health.

Insights for Value Investors Seeking Stable Income

Based on an F-Score of 8, PerkinElmer (PKI) seems like a solid investment prospect. Its high score indicates good profitability, efficiency, and overall financial health. However, investors should be cautious about its current ratio, which may pose short-term liquidity risks. Moreover, the lower-than-average ROA compared to industry peers is a concern. Potential investors might want to keep an eye on these factors. If you're willing to accept some risk for liquidity and compare with competitive industry returns, PKI could be a strong candidate for your investment portfolio.

For those who are interested in delving deeper into the specifics, the subsequent section provides a comprehensive exploration of the criteria.

Profitability of PerkinElmer (PKI)

Company has a positive net income?

Net income reflects a company's profitability over a given period and is a critical measure of financial performance. A positive net income indicates profitability, boosting investor confidence and adding a point in the Piotroski analysis.

As of 2023, PerkinElmer (PKI) reported a net income of $569,179,000, which is positive. This is a good indicator for the company as it reflects continued profitability. Over the past 20 years, PKI's net income has shown periods of growth and fluctuation, but in recent years, particularly from 2020 to 2022, net income has remained largely positive, strengthening investor confidence. Therefore, this criterion yields 1 point.

Company has a positive cash flow?

Cash Flow from Operations (CFO) represents the amount of cash a company generates from its normal business operations. Positive CFO is critical as it indicates the company's ability to generate sufficient cash to maintain and grow its operations.

PerkinElmer's CFO in 2023 is $679.81 million, which is positive. This indicates that the company is generating sufficient cash from its regular business operations. Over the past 20 years, PKI's CFO has seen a consistent upward trend from $167.475 million in 2003 to $679.81 million in 2023, peaking at $1.41075 billion in 2022. This positive momentum solidifies confidence in the firm's operational efficiency and financial health. Hence, this criterion earns a score of 1 point for Piotroski analysis.

Return on Assets (ROA) are growing?

Change in Return on Assets (ROA) for PerkinElmer (PKI) is crucial as it indicates the company's effectiveness in generating profit from its assets.

PerkinElmer's ROA increased slightly from 0.0397 in 2022 to 0.0403 in 2023, earning the company 1 point. While ROA has improved for the year, it remains significantly below the industry median of 0.504 in 2023. This low ROA suggests the company may not be utilizing its assets as effectively as many of its industry peers, raising concerns about operational efficiency, despite incremental improvement.

Operating Cashflow are higher than Netincome?

This criterion examines if the operating cash flow exceeds net income, indicating stronger cash generation versus reported earnings.

For PerkinElmer (PKI) in 2023, the operating cash flow was $679,810,000 while net income was $569,179,000. As the operating cash flow surpasses the net income, it adds 1 point based on the Piotroski F-score. This is a favorable trend, showing that the company's cash-generating ability is robust and exceeds what it reports as net income. Historically, observing the trend, PerkinElmer has seen fluctuations but there's a discernible upward trajectory in both metrics. For instance, in 2020, operating cash flow was $1,410,750,000 compared to a net income of $579,179,000. A higher operating cash flow relative to net income typically suggests higher earnings quality and better financial health.

Liquidity of PerkinElmer (PKI)

Leverage is declining?

Change in Leverage measures the company's efficiency in managing its debts. A decrease is preferred.

Comparing the leverage of PerkinElmer (PKI) between 2022 and 2023, we see it increased slightly from 0.2898 to 0.2777. Over 20 years, the leverage has seen fluctuations, peaking at 0.344 in 2021 and being lowest at 0.0605 in 2006. The recent comparison means a 0 score, reflecting unchanged debt management efficiency in this period. Despite annual variations, PKI generally balances leverage, ensuring financial predictability.

Current Ratio is growing?

The current ratio is a liquidity ratio that measures a company's ability to pay short-term obligations or those due within one year. A higher current ratio indicates a stronger liquidity position.

The current ratio for PerkinElmer in 2023 is 0 compared to 2.1052 in 2022. This shows a significant decline in liquidity, signifying that the company's ability to meet short-term liabilities has drastically worsened. Over the past 20 years, PKI has generally had a lower current ratio compared to the industry median, but such a drop to zero is unprecedented. The industry median for 2023 is 2.3682, highlighting how far PKI has fallen behind peers. This is a bad trend; thus, we assign 0 points.

Number of shares not diluted?

Shares outstanding refers to the total number of shares of a company’s stock that are currently owned by all its shareholders, including share blocks held by institutional investors and restricted shares owned by the company’s officers and insiders.

Between 2022 and 2023, the outstanding shares slightly decreased from 126,426,000 to 126,412,000, resulting in a decrease and earning 1 point based on the Piotroski analysis. This reduction can be perceived as a positive indicator, potentially signifying that PerkinElmer (PKI) is engaging in share repurchases, which can be a good sign for investors as it may indicate the company's confidence in its own financial health and can improve earnings per share (EPS). To provide perspective, observing the last 20 years shows a generally fluctuating trend, with a peak of 131,425,490 shares in 2005. The recent decrease, although marginal, fits well within this context and hints at a more stable share count strategy in recent years.

Operating of PerkinElmer (PKI)

Cross Margin is growing?

Gross Margin measures a company's efficiency in producing goods, compared to its cost of goods sold. A rise implies better financial health.

PerkinElmer (PKI) has shown an increase in its Gross Margin from 0.6008 in 2022 to 0.6162 in 2023. This upward trend is a positive indicator for the company, demonstrating enhanced efficiency in managing its production costs relative to revenue. Over the last 20 years, PKI's Gross Margin has consistently climbed from 0.4097 in 2003, with notable jumps such as from 0.5578 in 2020 to 0.5627 in 2021. The industry median Gross Margin in 2023 stands at 0.504, placing PKI well above its peers. This superior performance grants PKI a point in the Piotroski analysis, underscoring its competitive edge and operational efficiency.

Asset Turnover Ratio is growing?

Asset Turnover, a key efficiency metric, measures how effectively a company uses its assets to generate sales. An increasing trend is essential for evaluating operational efficiency.

The Asset Turnover ratio for PerkinElmer (PKI) has risen from 0.2273 in 2022 to 0.2344 in 2023, indicating a slight improvement in the company's ability to utilize its assets for generating revenues. This increase, albeit marginal, merits a positive outlook and thus adds 1 point to the Piotroski score. Examining long-term trends, the company's Asset Turnover has displayed significant fluctuations over the last 20 years, peaking at 0.6589 in 2008. The recent years, however, show a downward trend until 2022, with a modest recovery in 2023. Ensuring consistent improvement in this ratio is vital for sustaining investor confidence and operational excellence.