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Last update on 2024-06-07

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

Comprehensive analysis of CANCOM (COK.DE) using Piotroski F-Score for 2023, with a final score of 6/9, including detailed insights into profitability, liquidity, and operations.

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 CANCOM (COK.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?
1
Operating Cashflow are higher than Netincome?
1
Leverage is declining?
0
Current Ratio is growing?
0
Number of shares not diluted?
0
Cross Margin is growing?
1
Asset Turnover Ratio is growing?
1

The Piotroski F-Score is a metric that grades a company's financial health based on profitability, liquidity, and efficiency. It ranges from 0 to 9, with higher scores reflecting stronger financial positions. CANCOM (COK.DE) received a score of 6. This score is calculated by evaluating nine aspects of the company's financials, including net income, cash flow, return on assets, operating cash flow versus net income, leverage, current ratio, share dilution, gross margin, and asset turnover. CANCOM shows positive trends in profitability and operational efficiency, but struggles with aspects of liquidity and leverage.

Insights for Value Investors Seeking Stable Income

Based on the Piotroski F-Score of 6, CANCOM (COK.DE) is in reasonably good financial health. It excels in profitability and operational efficiency, demonstrating strong cash flow and asset utilization. However, be mindful of increasing leverage and declining liquidity, which could pose potential risks. For an investor, it might be worthwhile to look further into CANCOM as it presents a mixed but generally positive financial position. Further research into the company's handling of its debt and liquidity could be essential before making any investment decisions.

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

Profitability of CANCOM (COK.DE)

Company has a positive net income?

Net income refers to the total profit of a company after expenses and taxes are subtracted from total revenue. It's crucial for assessing overall profitability.

Historical Net Income of CANCOM (COK.DE)

The net income for CANCOM in 2023 stands at €36,827,000, showcasing a positive trend. Historical data reveals that CANCOM has consistently maintained positive net income over the last two decades, with significant highs in 2021. This repetitively positive net income trajectory underscores CANCOM's ability to generate profit sustainably, reinforcing investor confidence. Thus, this criterion adds 1 point to the Piotroski F-Score.

Company has a positive cash flow?

Cash Flow from Operations (CFO) measures the amount of cash generated or consumed by a company through its core business activities.

Historical Operating Cash Flow of CANCOM (COK.DE)

CANCOM (COK.DE) has recorded a positive CFO of €94,630,000 for 2023. This is a significant turnaround compared to the negative €53,565,000 in 2022, indicating strong performance in core business operations. Significant fluctuations in CFO values over the past 20 years underscore the importance of consistent positive cash flow for financial stability. Thus, CANCOM earns 1 point for positive CFO in 2023, affirming this as a good trend.

Return on Assets (ROA) are growing?

The criterion examines the change in Return on Assets (ROA) to assess the company's profitability improvement. An increasing ROA signifies better utilization of assets.

Historical change in Return on Assets (ROA) of CANCOM (COK.DE)

Comparing the ROA of CANCOM for the year 2023, which stands at 0.0258, with 2022's ROA of 0.0227, we observe an increment. This increment indicates enhanced profitability and improved efficiency in utilizing assets in 2023 compared to 2022. Given this positive trend, CANCOM meets this specific criterion of the Piotroski F-score and earns 1 point, affirming robust operational performance.

Operating Cashflow are higher than Netincome?

Compare the Operating Cash Flow with the Net Income. If Operating Cash Flow is higher, it suggests good earnings quality and the stock gets one point.

Historical accruals of CANCOM (COK.DE)

For the fiscal year 2023, CANCOM's Operating Cash Flow was €94.63 million, significantly higher than the Net Income of €36.83 million. This divergence indicates a healthy cash generation from business operations, which is often seen as a positive sign regarding earnings quality. Historically, CANCOM has seen fluctuating operating cash flow with peaks in years such as 2018 (€124.95 million) and troughs in 2022 (-€53.57 million). The latest figures reaffirm this stability in cash flow generation. Therefore, this criterion results in adding 1 point for CANCOM as the Operating Cash Flow exceeds Net Income, reflecting positively on the company's earnings quality.

Liquidity of CANCOM (COK.DE)

Leverage is declining?

Change in leverage represents the variation in a company's financial leverage over a period. Lower leverage often indicates a stronger financial position.

Historical leverage of CANCOM (COK.DE)

When comparing the leverage of CANCOM (COK.DE) from 2022 to 2023, it is evident that it increased from 0.075 to 0.0942. This trend is unfavorable as it indicates a rise in the company's financial leverage, suggesting potentially higher financial risk. Over the past 20 years, the leverage has seen fluctuations, with significant peaks and troughs, highlighting varying phases of financial strategy and risk management within the company.

Current Ratio is growing?

Current Ratio: This metric compares a company's current assets to its current liabilities. A higher ratio indicates better liquidity and higher safety margins.

Historical Current Ratio of CANCOM (COK.DE)

In 2023, CANCOM's current ratio is 1.5207, which reflects a decrease compared to the ratio of 1.9982 in 2022. This decline suggests a decrease in liquidity and indicates that CANCOM now has less capability to cover its short-term liabilities than it did previously. Examining the long-term trend, CANCOM's current ratio has significantly fluctuated, with highs such as 2.2895 in 2021 and lows like 1.2653 in 2018. Comparing CANCOM's current ratio over the past two decades to the industry median, it is evident that CANCOM has often kept pace with or exceeded the industry median, demonstrating its focused efforts on maintaining liquidity. However, in 2023, although still above the industry median of 1.4169, the decline is notable. This trend does not warrant assigning a point to the Piotroski score; thus, the score remains at 0 for this criterion.

Number of shares not diluted?

The shareholder's equity can be diluted if the company increases its shares outstanding, meaning current shareholders would own a smaller portion of the company.

Historical outstanding shares of CANCOM (COK.DE)

The Outstanding Shares for CANCOM (COK.DE) increased from 35,897,465 in 2022 to 36,811,798 in 2023. This increase translates to roughly a 2.55% rise in the number of shares outstanding. The historical data also signals a persistent trend of increasing shares over the past two decades. From 2003 to 2023, CANCOM’s Outstanding Shares have grown from 15,915,458 to 36,811,798, more than doubling over the period. This increased dilution is generally considered negative for existing shareholders as their share of ownership reduces with each increase. Therefore, based on the Piotroski F-Score for financial health, this would result in zero points.

Operating of CANCOM (COK.DE)

Cross Margin is growing?

This criterion analyses whether the gross margin has improved from one year to the next. A rising gross margin indicates better cost management and pricing power.

Historical gross margin of CANCOM (COK.DE)

The Gross Margin for CANCOM has increased from 0.3348 in 2022 to 0.3782 in 2023. This substantial improvement is a positive indication, adding 1 point in this criterion. This increase also signifies enhanced cost management and better pricing strategies. Historical data suggests that CANCOM's gross margin has been erratic over the years, but this recent uptick surpasses both its previous year and the industry median of 0.3391 for 2023.

Asset Turnover Ratio is growing?

Asset Turnover measures the efficiency of a company's use of its assets to generate sales or revenue.

Historical asset turnover ratio of CANCOM (COK.DE)

In 2023, CANCOM (COK.DE) reported an Asset Turnover of 1.0773, compared to 0.9642 in 2022. This represents an increase, which is a positive trend. Improved Asset Turnover suggests that CANCOM has become more efficient in utilizing its assets to generate revenue. Historically, however, it's notable that current levels are significantly lower than those in the early 2000s (e.g., 6.5155 in 2003). This long-term decline warrants further scrutiny, but the year-on-year improvement from 2022 to 2023 adds one positive point in Piotroski's score metric.


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