AT1.DE 2.13 (-4.48%)
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Last update on 2024-06-07

Aroundtown (AT1.DE) - Piotroski F-Score Analysis for Year 2023 (Final Score: 5/9)

Aroundtown (AT1.DE) Piotroski F-Score for 2023: Detailed analysis of profitability, liquidity, and operating efficiency. Final score: 5/9.

Knowledge hint:
The Piotroski F-Score is a number between 0 to 9 which reflects the strength of a company's financial position. It is based on 9 criteria involving profitability, liquidity, and leverage. This model helps investors identify stocks that are strong, undervalued investments.
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Short Analysis - Piotroski Score: 5

We're running Aroundtown (AT1.DE) against the Piotroski 9-criteria scoring system to assess profitability, liquidity, and operating efficiency:

Criteria
Company has a positive net income?
0
Company has a positive cash flow?
1
Return on Assets (ROA) are growing?
0
Operating Cashflow are higher than Netincome?
1
Leverage is declining?
0
Current Ratio is growing?
0
Number of shares not diluted?
1
Cross Margin is growing?
1
Asset Turnover Ratio is growing?
1

Aroundtown (AT1.DE) was analyzed using the Piotroski F-Score, which measures a company's financial strength out of a possible 9 points. Aroundtown received a score of 5. The analysis focused on 9 criteria, covering profitability, liquidity, and operating efficiency. For profitability, Aroundtown scored points for positive cash flow and having operating cash flow higher than net income but missed out on points for net income and return on assets. In terms of liquidity, Aroundtown didn't score any points due to rising leverage and a decreasing current ratio, although its share dilution improved. Regarding operating efficiency, the company managed to score points for growing gross margin and asset turnover ratios.

Insights for Value Investors Seeking Stable Income

Given Aroundtown's Piotroski F-Score of 5, the company shows mixed signals. While its strong cash flow and operational efficiency are promising, concerns about profitability and liquidity persist. This middle-of-the-road score suggests that potential investors should cautiously deepen their research. Aroundtown's strengths in cash generation could be attractive, but persistent losses and increasing leverage are major concerns that shouldn't be overlooked. Therefore, more due diligence and possibly comparing it with other investment opportunities are advisable before making a decision.

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

Profitability of Aroundtown (AT1.DE)

Company has a positive net income?

Net income is the company's total earnings, reflecting profitability.Utilizing positive net income indicates healthy financial performance.

Historical Net Income of Aroundtown (AT1.DE)

The net income for Aroundtown in 2023 is -1,834,200,000, clearly indicating a net loss. Compared to the last decade, this trend signals a negative shift. For instance, the net income consistently ranged between 141,000,000 in 2013 and 1,666,500,000 in 2018 until experiencing declines starting from -527,000,000 in 2022. This 2023 figure is highly concerning, marking the second consecutive loss and the largest in the dataset. The Piotroski score for this criterion is 0, emphasizing financial distress.

Company has a positive cash flow?

Positive cash flow from operations indicates that a company can generate sufficient cash to maintain and grow its operations without resorting to external financing.

Historical Operating Cash Flow of Aroundtown (AT1.DE)

For 2023, Aroundtown (AT1.DE) reported a positive Cash Flow from Operations (CFO) of €772.1 million. This is a clear indication that the company has been able to generate sufficient cash internally to support its operational activities. Over the last decade, Aroundtown has consistently shown an increasing trend in its CFO, rising from €68 million in 2013 to €772.1 million in 2023. The positive cash flow throughout these years not only signifies operational efficiency but also underpins the company’s capability to self-finance investments or repay debts. This trend is exceptionally favorable as it suggests strong operational health and robust cash-generating ability, earning 1 point for this criterion in the Piotroski Analysis.

Return on Assets (ROA) are growing?

Change in Return on Assets (ROA) evaluates a company's efficiency in generating profits from its assets as profitability is crucial for long-term sustainability.

Historical change in Return on Assets (ROA) of Aroundtown (AT1.DE)

In 2023, Aroundtown (AT1.DE) reported a ROA of -0.0517, compared to -0.0137 in 2022. This decrease indicates a worsening efficiency in utilizing its assets to generate profits. Over the last decade, its operating cash flow has seen a general uptrend, barring minor fluctuations, rising from €68 million in 2013 to €772.1 million in 2023. While this is a positive indication of cash generation capabilities, the negative and decreasing ROA over the past two years signifies profitability issues. Moreover, comparing its ROA to the industry median, which has remained positive albeit declining slightly from 0.5252 in 2013 to 0.4039 in 2023, Aroundtown's performance appears particularly concerning. Therefore, no points are awarded for this criterion.

Operating Cashflow are higher than Netincome?

Explain the criterion for Aroundtown (AT1.DE) and why it is important to consider

Historical accruals of Aroundtown (AT1.DE)

The Operating Cash Flow is indeed higher than the Net Income. For 2023, the Operating Cash Flow was €772.1 million, whereas the Net Income was substantially negative at -€1.8342 billion. Thus, it gets 1 point for this criterion. This is a positive trend, as it indicates that Aroundtown is capable of generating cash from its core operations despite a net loss. Consistent positive Operating Cash Flow across the last decade further solidifies this trend.

Liquidity of Aroundtown (AT1.DE)

Leverage is declining?

Leverage measures the level of debt a company is using to finance its operations. It is important as it affects the risk profile of the company.

Historical leverage of Aroundtown (AT1.DE)

The leverage for Aroundtown increased from 0.3969 in 2022 to 0.4212 in 2023, indicating that the company has increased its use of debt. This is concerning as higher leverage can imply greater financial risk. Historically, the leverage for Aroundtown has fluctuated, reaching its highest in recent years. It was as low as 0.2236 in 2014 and has been rising. Notably, over the last decade, while some years saw a decrease in leverage, the current trend shows a rise. This trend is a negative signal in the Piotroski Analysis framework, scoring 0 points in this criterion.

Current Ratio is growing?

The current ratio is a liquidity ratio that measures a company's ability to pay short-term obligations. A rising current ratio often indicates improving liquidity.

Historical Current Ratio of Aroundtown (AT1.DE)

For Aroundtown (AT1.DE), the current ratio has decreased from 3.7667 in 2022 to 3.0478 in 2023. This trend is negative as it indicates the company's short-term liquidity weakened. Comparatively, the industry median was 1.8472 in 2022 and reduced to 1.6881 in 2023, indicating the general industry trend also saw a decline. Despite the decrease, Aroundtown's current ratio remains significantly above the industry median, suggesting it is still relatively liquid compared to peers. However, due to the decrease in the ratio, we must assign 0 points for this criterion.

Number of shares not diluted?

Change in Shares Outstanding evaluates whether a company is issuing new shares or buying back shares, which impacts shareholder value.

Historical outstanding shares of Aroundtown (AT1.DE)

Aroundtown's Outstanding Shares decreased from 1,109,900,000 in 2022 to 1,093,000,000 in 2023, resulting in a decrease of approximately 1.5%. This trend is positive, as reducing the number of shares outstanding can indicate a share buyback strategy, enhancing shareholder value by increasing each share's ownership proportion. Over the last decade, Aroundtown had fluctuating share numbers, but the recent trend towards decreasing shares is favorable for current shareholders. Thus, we add 1 point based on the Piotroski criteria.

Operating of Aroundtown (AT1.DE)

Cross Margin is growing?

Gross Margin assesses the efficiency of a company's production process by comparing the company's gross profit to its revenue. A higher gross margin indicates more efficiency.

Historical gross margin of Aroundtown (AT1.DE)

In 2023, Aroundtown's Gross Margin increased to 0.4648 from 0.4314 the previous year. This 7.74% increase is positive, indicating improved efficiency. Historical data shows fluctuating margins, with a peak of 0.7806 in 2018 and a trough of 0.4314 in 2022. Comparatively, Aroundtown's Gross Margin has been above the industry's median, except in 2022. The positive trend in 2023 regains its competitive edge. Based on this, Aroundtown scores 1 point for the Gross Margin criterion within the Piotroski Analyses.

Asset Turnover Ratio is growing?

Asset Turnover measures a company's efficiency in using its assets to generate revenue. A rising Asset Turnover ratio indicates improved efficiency.

Historical asset turnover ratio of Aroundtown (AT1.DE)

In 2023, Aroundtown's Asset Turnover increased to 0.0336 from 0.0319 in 2022. This marks an uptick of approximately 5.33%, suggesting enhanced efficiency in utilizing its assets to generate revenue. Examining the historical Asset Turnover data over the last 20 years reveals fluctuating performance, most notably a peak at 0.1426 in 2014 and a downturn to its lowest at 0.0309 in 2021. The positive trend in 2023 is a slight, yet encouraging sign. Given the established Piotroski criterion, Aroundtown scores 1 point for the increase in Asset Turnover, reflecting an improvement in operational efficiency.


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