Last update on 2024-06-07

Klepierre (KPR.F) - Piotroski F-Score Analysis for Year 2023 (Final Score: 6/9)

Analyze Klepierre's (KPR.F) 2023 Piotroski F-Score of 6/9 for insights into financial health, profitability, liquidity, and leverage.

Short Analysis - Piotroski Score: 6

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

The Piotroski F-Score assesses companies on nine criteria involving profitability, liquidity, and leverage, with a score between 0 and 9 indicating the strength of a company's financial position. Klepierre (KPR.F) scored 6 out of 9, reflecting a relatively strong financial position. Here is the breakdown: 1. **Profitability:** - Positive net income: 1 point (Net income for 2023 was €192.7 million) - Positive cash flow from operations: 1 point (€933.8 million in 2023) - Operating Cashflow > Net Income: 1 point (Operating cash flow significantly exceeds net income) - Growing ROA: Not explicitly addressed but suggested to monitor for future evaluations. 2. **Liquidity:** - Growing Current Ratio: 1 point (Current Ratio improved to 0.3942 from 0.299) - Declining Leverage: 0 points (Leverage increased, signaling higher financial risk) 3. **Leverage:** - Shares not diluted: 0 points (Slight increase in outstanding shares) - Gross Margin growing: 1 point (Increased from 0.757 to 0.7632) - Growing Asset Turnover Ratio: 1 point (Increased from 0.0675 to 0.0699) Overall, Klepierre's key strengths are in its operational cash flows, improved current ratio, and efficient asset utilization. The concerns lie in elevated leverage and dilution of shares.

Insights for Value Investors Seeking Stable Income

Based on the Piotroski F-Score of 6 out of 9, Klepierre (KPR.F) appears to be a relatively strong investment option. The company's liquidity and profitability metrics are showing encouraging signs, particularly the substantial operational cash flow and the improvement in the current ratio. However, prospective investors should be cautious about the rising leverage and shareholder dilution risks. Given these factors, Klepierre may be worth further consideration, especially for those with a higher risk tolerance and who are willing to delve deeper into its financial health and market conditions. It's also important to monitor the financial metrics over time to ensure that the positive trends continue.

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

Profitability of Klepierre (KPR.F)

Company has a positive net income?

Net income indicates whether a company is profitable. Positive net income adds 1 point in Piotroski Analysis.

For 2023, Klépierre (KPR.F) shows a net income of €192,700,000, which is positive. Hence, it scores 1 point for this criterion. Over a broader horizon, analyzing their net income for the last 20 years shows a fluctuating trend: significant profits in several years, especially in 2005 (€1,459,021,000) and in some recent past years (2016 with €1,191,300,000 and 2017 with €1,228,600,000). There were downturns as well, most notably in 2015 (a loss of €499,800,000) and 2020 (a loss of €785,700,000). The most recent positive net income underscores a recovery from the 2020 downturn and highlights financial health, though investors should be cautious of past volatility.

Company has a positive cash flow?

Positive cash flow from operations indicates strong operational efficiency and liquidity.

In 2023, Klepierre reported a CFO of €933.8 million. This robustness reflects positively on the company's operational performance, scoring 1 point in the Piotroski analysis. Over the past 20 years, Klepierre's CFO has generally been on an upward trend, climbing from €137.22 million in 2003 to the current €933.8 million. This steady increase highlights consistent operational cash generation, which augurs well for both liquidity and long-term financial health.

Return on Assets (ROA) are growing?

Explain the criterion for Klepierre (KPR.F) and why it is important to consider

Change in ROA (Return on Assets) is an essential criterion in Piotroski Analysis because it reflects the company's efficiency in generating profits relative to its assets. An increased ROA indicates improved profitability and asset utilization.

Operating Cashflow are higher than Netincome?

This criterion checks if the company's operating cash flow is higher than its net income, indicating strong earnings quality.

In 2023, Klepierre (KPR.F) had an operating cash flow of €933.8 million and a net income of €192.7 million. Clearly, the operating cash flow exceeds the net income significantly. This results in a score of +1 for this criterion, suggesting that Klepierre's earnings are indeed of high quality. Over the past 20 years, operating cash flow has generally remained robust, often surpassing net income. The only notable exception is the year 2015 when net income spiked to €1.19 billion due to extraordinary items. Despite fluctuations, the company's consistent operating cash flows indicate stability. This positive trend, particularly in 2023, reinforces investor confidence in Klepierre's financial health.

Liquidity of Klepierre (KPR.F)

Leverage is declining?

Change in leverage compares a company's debt levels over time to determine financial risk. A decrease typically indicates less risk.

In 2022, Klepierre had a leverage ratio of 0.2855. However, in 2023, the leverage ratio increased to 0.3129. This rise in leverage suggests that the company has taken on more debt relative to its equity, implying an increase in financial risk. Historically, their leverage peaked at 0.4918 in 2014 and began a gradual decline until 2022. However, the recent uptick highlights a possible reversal of this trend. Hence, for leverage, the trend is unfavorable for 2023, earning a score of 0.

Current Ratio is growing?

Explain the criterion for Klepierre (KPR.F) and why it is important to consider

The Current Ratio measures a company's ability to cover its short-term liabilities with its short-term assets. A ratio below 1 indicates potential liquidity issues. Klepierre's Current Ratio in 2023 is 0.3942, up from 0.299 in 2022. Although this marks an improvement, it still suggests liquidity concerns. Over the past 20 years, Klepierre's ratio has been consistently below the industry median. This increase adds 1 point to its score, marking it as a positive trend, though it remains far from ideal given the industry median in 2023 stands at 1.1846.

Number of shares not diluted?

Shares Outstanding measures the total number of shares of stock that are currently owned by shareholders. It is important as it affects earnings per share (EPS).

Comparing the outstanding shares of Klepierre (KPR.F) from 2022 to 2023, we observe an increase from 285,442,230 shares to 285,504,966 shares. Therefore, no point is awarded here. This trend indicates shareholder dilution, which often negatively impacts the existing investors as their share of the company’s earnings dwindles. Furthermore, reviewing the last 20 years of outstanding shares shows a general increase in terms of dilution risk, notable peaks include 2009 (post-2008 financial crisis) and 2015, going from 178,463,277 shares in 2009 to 306,803,561 shares in 2015. However, recent years show more stability around 285 million shares; hence, any incremental increase, although unfavorable, is relatively modest compared to historic fluctuations.

Operating of Klepierre (KPR.F)

Cross Margin is growing?

Analyze the change in Gross Margin for Klepierre (KPR.F) between 2022 and 2023.

In 2023, Klepierre's Gross Margin stood at 0.7632, up from 0.757 in 2022. This increase indicates improved profitability and cost management. Considering this increase, Klepierre earns 1 point. By looking at the historical data, the Gross Margin exhibits some fluctuations. However, the 2023 margin is above the Industry Median of 0.7072, highlighting Klepierre's superior performance. This upward trend is a positive indicator.

Asset Turnover Ratio is growing?

Asset Turnover measures a company's efficiency in generating sales from its assets. It's crucial as higher turnover can indicate better performance.

Klepierre's Asset Turnover increased from 0.0675 in 2022 to 0.0699 in 2023. This growth, albeit modest, shows improved efficiency in utilizing assets to generate revenue, awarding it 1 point in the Piotroski Analysis. For context, over the last 20 years, Klepierre's highest Asset Turnover was 0.1182 in 2003 and its lowest was 0.05 in 2017, indicating its historical fluctuations. This trend in 2023 is a positive sign for the investors.