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Last update on 2024-06-07

Bechtle (BC8.DE) - Piotroski F-Score Analysis for Year 2023 (Final Score: 6/9)

Analyze Bechtle's (BC8.DE) performance with a Piotroski F-Score of 6/9 for 2023, highlighting strengths in profitability, cash flow, and liquidity.

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: 6

We're running Bechtle (BC8.DE) against the Piotroski 9-criteria scoring system to assess profitability, liquidity, and operating efficiency:

Criteria
Company has a positive net income?
1
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?
1
Number of shares not diluted?
1
Cross Margin is growing?
1
Asset Turnover Ratio is growing?
0

The Piotroski F-Score provides insight into Bechtle's financial health with a score of 6. The positivity of the company's net income and cash flow shows profitability. Nonetheless, a declining Return on Assets and increased debt raise concerns. Factors like unchanged gross margin and reduced asset turnover also highlight operational inefficiencies. Though liquidity metrics improved, the share count remains stable, indicating neither favorable nor adverse changes.

Insights for Value Investors Seeking Stable Income

With a Piotroski F-Score of 6, Bechtle displays moderate financial strength. Positive net income and strong cash flows reflect good profitability, making it appealing for conservative, long-term investors. However, the rise in leverage and drawbacks in operational efficiency suggest potential risks. Consider diving deeper into Bechtle's future strategic plans and market position before making investment decisions. It might be worthwhile for those willing to take on moderate risk while seeking steady returns over time.

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

Profitability of Bechtle (BC8.DE)

Company has a positive net income?

Check if the net income for Bechtle (BC8.DE) in the year 2023 is positive or negative. A positive net income indicates operational profitability and enhancing shareholder value. It's crucial for evaluating the company's financial health.

Historical Net Income of Bechtle (BC8.DE)

The net income for Bechtle in 2023 is a positive 265512000, reflecting not only a sound operational performance but also an upward trend over the years. Observing a steady increase from €18.365 million in 2003 to €265.512 million in 2023 signifies robust profitability and potential for sustained financial strength. This consistency in positive net income over two decades bodes well for long-term investors.

Company has a positive cash flow?

The Cash Flow from Operations (CFO) should be positive.

Historical Operating Cash Flow of Bechtle (BC8.DE)

Bechtle (BC8.DE) has posted a Cash Flow from Operations (CFO) of €459.03 million in 2023. This shows a substantial improvement compared to €116.65 million in 2022. Moreover, it's the highest CFO figure in the last 20 years, following a variable trajectory but with consistent positive values, especially since 2015. A consistent positive cash flow enhances the company's ability to sustain operations, pay debts, and fuel growth, which is a good indicator for investors. Consequently, this criterion scores a definitive 1 point.

Return on Assets (ROA) are growing?

The criterion evaluates the change in the Return on Assets (ROA) from one year to the next, indicating the company's profitability relative to its total assets.

Historical change in Return on Assets (ROA) of Bechtle (BC8.DE)

For Bechtle (BC8.DE), the ROA has decreased from 0.0777 in 2022 to 0.0732 in 2023. This decrease of 0.0045 suggests a slight decline in the company’s efficiency in generating profit from its assets. Historically, Bechtle's ROA for the past 20 years has shown variability, with operating cash flows fluctuating significantly during this period. When comparing these figures to the industry median, which has been consistently higher (ranging from 0.2854 to 0.3391), Bechtle's performance on this front requires scrutiny. The slight downward trend in ROA for 2023 marks a potentially negative signal, emphasizing the need for strategic improvements to boost asset profitability. Consequently, this criterion scores 0 points.

Operating Cashflow are higher than Netincome?

Examine whether Bechtle's Operating Cash Flow is higher than Net Income. This is crucial for evaluating the quality of earnings and overall financial health.

Historical accruals of Bechtle (BC8.DE)

For Bechtle in 2023, the Operating Cash Flow is €459,031,000 compared to a Net Income of €265,512,000. Since Operating Cash Flow is higher than Net Income, this criterion adds 1 point. This is a positive trend because it suggests that the company's net income is backed by actual cash flow rather than accounting adjustments. Historically, the Operating Cash Flow has shown a consistent upward trajectory from €27,535,000 in 2003 to €459,031,000 in 2023, reinforcing confidence in its financial health. Similarly, Net Income has also expanded significantly, adding credibility to operational efficiency. Therefore, the trend for this criterion is very favorable.

Liquidity of Bechtle (BC8.DE)

Leverage is declining?

Leverage here indicates the level of debt used to finance Bechtle's assets. Lower leverage is typically favorable as it suggests lower financial risk.

Historical leverage of Bechtle (BC8.DE)

In 2023, Bechtle's leverage ratio rose to 0.1737 from the previous year's 0.1045 in 2022. This increase in leverage signifies a higher dependency on debt to finance the company's assets, suggesting elevated financial risk. Historically, Bechtle has maintained relatively low leverage, with deviations seen in 2018 (0.1878) and during the COVID period in 2020 (0.1857). The rise to a leverage ratio of 0.1737 in 2023 could be seen as an unfavorable trend, as a more substantial portion of assets is now financed through debt, implying greater financial commitments in terms of interest payments and other debt obligations—a possible red flag for investors focusing on financial stability.

Current Ratio is growing?

The Current Ratio compares a company's current assets to its current liabilities. It's essential as it measures a company's ability to cover short-term debts with short-term assets. A higher ratio indicates better liquidity.

Historical Current Ratio of Bechtle (BC8.DE)

As of 2023, Bechtle's Current Ratio is 1.8624, which signifies an improvement from 1.6147 in 2022. This positive change results in adding 1 point according to the Piotroski criteria. A rising Current Ratio suggests enhanced liquidity, making it safer for the company to meet its short-term obligations. Historically, Bechtle's Current Ratio has been relatively stable, often sitting above the industry median, which has often fluctuated below 1.6. This recent increase further strengthens Bechtle's standing relative to its peers, underscoring its robust financial health and prudent management.

Number of shares not diluted?

Shares Outstanding measures the number of shares currently held by all shareholders. Decreasing shares suggest a company is possibly buying back shares, indicating potential confidence.

Historical outstanding shares of Bechtle (BC8.DE)

The Outstanding Shares for Bechtle remained constant at 126,000,000 from 2022 to 2023, showing no increase or decrease. According to the Piotroski Analysis, this results in assigning 0 points to this criterion. Historically, Bechtle's number of shares outstanding has mostly stabilized at 126,000,000 since 2009, indicating minimal dilution over recent years. This stability could be interpreted positively, as frequent share issuance might dilute existing shareholders’ value.

Operating of Bechtle (BC8.DE)

Cross Margin is growing?

The change in Gross Margin evaluates a company's efficiency in managing its production costs relative to its revenue over time.

Historical gross margin of Bechtle (BC8.DE)

For 2023, Bechtle's Gross Margin remains at 0.1747, identical to 2022's 0.1747. Therefore, no increase is observed, resulting in a score of 0 points. Over the last two decades, the values exhibit some variations, peaking at 0.1747 in the recent two years. Throughout this period, Bechtle's Gross Margin consistently stayed below the industry median. The industry’s Median Gross Margin, peaking at 0.3421 in 2010 and standing at 0.3391 in 2023, sheds light on the competitive nature of margins within the industry.

Asset Turnover Ratio is growing?

Asset Turnover measures a company's ability to generate sales from its assets. It's crucial for assessing efficiency.

Historical asset turnover ratio of Bechtle (BC8.DE)

The Asset Turnover of Bechtle (BC8.DE) has decreased from 1.8641 in 2022 to 1.7715 in 2023, resulting in a score of 0 points for this criterion. This decline indicates that the company has become less efficient in using its assets to generate sales. Over the past 20 years, there has been a significant decrease from 3.2993 in 2004 to the current level, reflecting a downward trend in asset utilization efficiency.


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