IART 29.84 (-0.57%)
US4579852082Medical Devices & InstrumentsMedical Devices

Last update on 2024-06-07

Integra Lifesciences Holdings (IART) - Piotroski F-Score Analysis for Year 2023 (Final Score: 4/9)

Explore the Piotroski F-Score analysis for Integra Lifesciences Holdings (IART) in 2023, highlighting key financial metrics, performance insights, and investment potential.

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: 4

We're running Integra Lifesciences Holdings (IART) 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?
0
Number of shares not diluted?
1
Cross Margin is growing?
0
Asset Turnover Ratio is growing?
0

The Piotroski F-Score for Integra Lifesciences Holdings (IART) is 4 out of 9, which indicates a moderate financial position. Out of the 9 criteria, the company scores points for positive net income, positive cash flow from operations, higher operating cash flow compared to net income, and a reduction in shares outstanding. However, it falls short in areas like return on assets, leverage, current ratio, gross margin, and asset turnover ratio, which have shown negative trends or declines.

Insights for Value Investors Seeking Stable Income

Given the moderate Piotroski F-Score and mixed performance across various financial criteria, Integra Lifesciences Holdings (IART) might require a cautious approach. The positive factors like net income and cash flow are encouraging, but the declines in asset efficiency and increasing leverage are concerning. It could be worth exploring for potential investment, but I would recommend conducting further in-depth analysis or consulting with a financial advisor before making any decisions.

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

Profitability of Integra Lifesciences Holdings (IART)

Company has a positive net income?

Evaluate if the net income for Integra Lifesciences Holdings in 2023 is positive or negative and why it matters.

Historical Net Income of Integra Lifesciences Holdings (IART)

In 2023, Integra Lifesciences Holdings reported a net income of $67,741,000, which is a positive figure. This metric is pivotal, as a positive net income signals profitability and operational success. Over the last 20 years, net income figures for the company have exhibited variance, with several peaks and troughs. Notably, the company experienced substantial negative net incomes in 2010 and 2015, but overall, the trend has been positive, especially in recent years. A positive net income in 2023 continues this trend and contributes 1 point to the Piotroski Score, affirming the company's ongoing profitability.

Company has a positive cash flow?

Cash Flow from Operations (CFO) represents the amount of cash a company generates from its regular business activities.

Historical Operating Cash Flow of Integra Lifesciences Holdings (IART)

The Cash Flow from Operations for Integra Lifesciences Holdings (IART) in 2023 stands at $139.955 million, which is positive. A positive CFO is generally indicative of strong financial health and operational efficiency, as it means the company is able to generate sufficient cash to cover its operating expenses. Thus, IART earns a point for this criterion. Over the past 20 years, the company's CFO has shown an overall upward trend with occasional dips, demonstrating long-term financial growth.

Return on Assets (ROA) are growing?

Change in Return on Assets (ROA) considers the year-on-year growth in profitability relative to the total assets used by the company. It helps gauge the efficiency of asset utilization to generate profit.

Historical change in Return on Assets (ROA) of Integra Lifesciences Holdings (IART)

For Integra Lifesciences Holdings (IART), the ROA in 2023 decreased to 0.0177 from 0.0471 in 2022. This decline signifies a less efficient use of assets to generate profit compared to the previous year, resulting in a negative evaluation of 0 points for this criterion. Over the past 20 years, the industry's median ROA has generally been stable, fluctuating slightly but maintaining a much higher level (ranging around 0.5456 to 0.6463). This data illustrates the need for Integra Lifesciences Holdings to reassess its asset efficiency strategies against industry standards to improve performance.

Operating Cashflow are higher than Netincome?

Operating cash flow is higher than net income

Historical accruals of Integra Lifesciences Holdings (IART)

For 2023, Integra Lifesciences Holdings (IART) shows an operating cash flow of $139.96 million compared to a net income of $67.74 million. This criteria grants 1 point as operating cash flow is higher than net income. Interpreting this data along the last 20 years, we observe a positive trend where operating cash flow often outpaces net income, indicating strong actual cash generation capabilities compared to accounting earnings. Historically, spikes in cash flow from operations, such as in 2009, 2018, and 2020, seem consistent with firm growth. However, 2023 shows a decrease from historical highs, hinting at need for cautious optimism.

Liquidity of Integra Lifesciences Holdings (IART)

Leverage is declining?

Leverage refers to the amount of debt a company uses to finance its assets, versus the amount of equity that is used. Lower leverage is generally better as it indicates a stronger equity position and lesser risk.

Historical leverage of Integra Lifesciences Holdings (IART)

In 2022, the leverage ratio for Integra Lifesciences Holdings (IART) stood at 0.4017, which increased to 0.4368 in 2023. This indicates that the company's reliance on debt has grown, marking an uptick in financial risk. Over a 20-year timeframe, leverage ratios fluctuated significantly, reaching as high as 0.5547 in 2017 and as low as 0.0008 in 2006. Although the leverage ratio remains below the 2017 peak, the increasing trend from 2022 to 2023 signifies a downturn in financial stability, meriting zero points for this criterion in Piotroski analysis.

Current Ratio is growing?

The current ratio measures a company's ability to pay short-term obligations with short-term assets. An increasing current ratio signifies a stronger liquidity position.

Historical Current Ratio of Integra Lifesciences Holdings (IART)

For Integra Lifesciences Holdings (IART), the current ratio decreased from 3.6194 in 2022 to 3.4466 in 2023. The decrease, although slight, indicates a reduced capability to cover short-term liabilities with short-term assets. Comparatively, it should be noted that the industry median current ratio has been volatile, standing at 4.0615 in 2023 from 3.6112 in 2022, indicating greater variability within the industry. IART's current ratio, remaining above the industry median for many years, still exhibits relatively strong liquidity despite the recent decrease. Therefore, for the Piotroski score, this criterion would not earn a point as the ratio has decreased year-over-year.

Number of shares not diluted?

Change in shares outstanding refers to the difference in the number of shares a company has issued and are currently in the hands of investors.

Historical outstanding shares of Integra Lifesciences Holdings (IART)

Given that the outstanding shares for Integra Lifesciences Holdings decreased from 83,587,963 in 2022 to 80,089,000 in 2023, we would add 1 point to this criteria. This reduction signifies a share buyback program, which can often be a good signal as it indicates the company is trying to return value to shareholders by reducing the supply of available shares. Furthermore, this trend breaks away from the increasing share counts observed between 2011 (58.99 million shares) and 2021 (84.70 million shares). Such buybacks can result in higher earnings per share (EPS), as the same net earnings are spread over fewer shares, indicating a promising financial maneuver.

Operating of Integra Lifesciences Holdings (IART)

Cross Margin is growing?

Gross Margin is a critical indicator of a company's financial health and efficiency, reflecting the percentage of revenue exceeding the cost of goods sold. It's vital for assessing profitability.

Historical gross margin of Integra Lifesciences Holdings (IART)

Integra Lifesciences Holdings (IART) experienced a decrease in Gross Margin from 0.6229 in 2022 to 0.5739 in 2023. This represents a decline in profitability efficiency as a lower Gross Margin suggests that a smaller portion of revenue is retained after covering the costs of goods sold. Over a 20 years span, the company's Gross Margin has generally been relatively high fluctuating somewhat but mostly outperforming the industry median. However, in 2023, for the first time, the Gross Margin fell below the industry median of 0.6463, indicating a concerning trend and thus yielding 0 points for this criterion.

Asset Turnover Ratio is growing?

Change in Asset Turnover measures how efficiently a company uses its assets to generate sales. A higher ratio indicates better performance.

Historical asset turnover ratio of Integra Lifesciences Holdings (IART)

Integra Lifesciences Holdings (IART) has witnessed a slight decline in its Asset Turnover ratio from 0.4061 in 2022 to 0.4019 in 2023. This decline suggests a marginal reduction in the efficiency with which the company has been utilizing its assets to generate revenue. Deviating from the single data-point comparison, a historical analysis reveals a concerning trend. For most of the past 20 years, the company has seen fluctuations in its Asset Turnover ratio, peaking at 0.7896 in 2006. However, the recent downturn is part of a longer-term trend of decline since 2009, where typically, we have not seen ratios close to historical highs. This consistent decrease over time may indicate underlying issues either with the strategic asset acquisition or its utilization in enhancing sales. Thus, for Piotroski Analysis, this criterion does not score a point as the Asset Turnover has decreased.


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