SYNA 91.02 (+1.77%)
US87157D1090SemiconductorsSemiconductors

Last update on 2024-06-07

Synaptics (SYNA) - Piotroski F-Score Analysis for Year 2023 (Final Score: 4/9)

Detailed Piotroski F-Score Analysis for Synaptics (SYNA) in 2023. Understand financial health, liquidity, and efficiency with historical data and charts.

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.
Learn more...

Short Analysis - Piotroski Score: 4

We're running Synaptics (SYNA) 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?
0
Cross Margin is growing?
0
Asset Turnover Ratio is growing?
0

We examined Synaptics (SYNA) using the Piotroski F-Score criteria, covering profitability, liquidity, and operational efficiency. SYNA achieved a score of 4 out of 9. Its net income and cash flow were positive for 2023, which is good. However, some metrics like return on assets and leverage showed negative trends. Their current ratio improved significantly, indicating better short-term liquidity, but the increasing number of shares suggests dilution. Moreover, gross margin and asset turnover ratios have declined, which are potential red flags.

Insights for Value Investors Seeking Stable Income

Given its score of 4 out of 9 on the Piotroski F-Score, Synaptics shows mixed signals. Although it has strong points like positive cash flow and an increasing current ratio, there are concerning signs with declining ROA, increasing leverage, falling asset turnover, and gross margin. These factors suggest caution. I'd recommend investigating further and considering other stocks, especially if they show better financial stability and efficiency.

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

Profitability of Synaptics (SYNA)

Company has a positive net income?

Analyzing net income trends is crucial for understanding a company’s financial health and profitability over time.

Historical Net Income of Synaptics (SYNA)

The net income for Synaptics (SYNA) in 2023 stands at $73,600,000, which is positive. This meets the Piotroski criterion, and thus, we assign a score of 1. To better grasp the trend, it's helpful to examine the historical net income data for the past 20 years. From 2003 to 2023, there have been fluctuations, with significant peaks, such as $257,500,000 in 2022, and downturns, such as a negative $124,100,000 in 2019. This historical context suggests that while Synaptics has shown periods of substantial profitability, it has also faced challenges. Overall, a positive net income in 2023 is a good indicator for the company's ongoing financial health, especially after the substantial profit in 2022.

Company has a positive cash flow?

Cash Flow from Operations (CFO) is a key indicator of the financial health of a company, reflecting its ability to generate cash through regular business operations.

Historical Operating Cash Flow of Synaptics (SYNA)

The Cash Flow from Operations (CFO) for Synaptics (SYNA) in 2023 stands at $331,500,000, which is indeed positive. Over the last 20 years, the CFO has shown a generally upward trend, although there have been fluctuations. For instance, in 2003, the CFO was a mere $11,664,000, and it has grown substantially over the years, peaking at $462,700,000 in 2022. This positive CFO in 2023 indicates that Synaptics has been effective in managing its cash flows from core operations, a bullish signal when assessing the company's financial health. Given this trend, this criterion would score 1 point.

Return on Assets (ROA) are growing?

Change in Return on Assets (ROA) assesses how well a company is utilizing its assets to generate earnings. This metric helps in determining the company's efficiency and profitability trends.

Historical change in Return on Assets (ROA) of Synaptics (SYNA)

The Return on Assets (ROA) for Synaptics in 2023 was 0.0269, which is a significant decrease compared to the ROA of 0.1013 in 2022. This trend is unfavorable as an increasing ROA would indicate improved efficiency in using assets to generate profits. The decline from 0.1013 to 0.0269 signifies a deteriorating efficiency in the company’s asset utilization, possibly indicating issues in operational performance or challenges in the business environment. Comparing this to the last 20 years industry median ROA, Synaptics' ROA has been consistently lower than the industry median, which poses a concern. Therefore, for this criterion, no point is awarded.

Operating Cashflow are higher than Netincome?

The criterion checks whether the company generates more cash from operations than it earns in net income, signifying efficient cash management.

Historical accruals of Synaptics (SYNA)

For Synaptics (SYNA) in 2023, Operating Cash Flow stands at $331.5 million, significantly higher compared to the Net Income of $73.6 million. This results in a score of 1 point. This comparison indicates robust cash generation from core operations, overshadowing accounting adjustments and non-cash items affecting net income. Over the past two decades, the company's Cash Flow from Operations shows strong growth, fluctuating initially but broadly trending upward from $11.66 million in 2003 to $331.5 million in 2023. Concurrently, Net Income has been more volatile, peaking at $257.5 million in 2022 before declining. Steady growth in Operating Cash Flow displays effective core operations and financial health, aligning with solid performance indicators despite bottom-line volatility.

Liquidity of Synaptics (SYNA)

Leverage is declining?

Change in Leverage is an important criterion in the Piotroski Analysis as it measures a company's change in debt levels, providing insight into financial risk and stability.

Historical leverage of Synaptics (SYNA)

Synaptics (SYNA) had a leverage ratio of 0.3594 in 2022, which increased to 0.3885 in 2023. This indicates an increase in the company's leverage. Historically, Synaptics has seen significant fluctuations in its leverage, notably peaking in 2005 at 0.4065. The increase in leverage from 2022 to 2023 suggests a higher financial risk and less stability, contrary to the ideal scenario suggested by Piotroski criteria. Therefore, based on this metric, Synaptics would not score a point for a decrease in leverage.

Current Ratio is growing?

Evaluating the change in Current Ratio assesses a company's short-term liquidity by comparing its ability to cover short-term liabilities with short-term assets.

Historical Current Ratio of Synaptics (SYNA)

The Current Ratio of Synaptics (SYNA) increased from 3.0285 in 2022 to 4.8904 in 2023. This represents a significant improvement in liquidity, indicating that the company is better positioned to meet its short-term obligations. As a result, Synaptics earns 1 point for this criterion in the Piotroski Analysis. Notably, the company's Current Ratio is also well above the industry median of 3.4213 for 2023, further underscoring its robust liquidity status. Historically, this trend seems largely positive compared to previous years when the Current Ratio dipped as low as 1.4996 in 2021. Overall, this upward movement signals healthier financial stability.

Number of shares not diluted?

The change in outstanding shares indicates whether a company is issuing more shares or buying back shares, affecting ownership dilution.

Historical outstanding shares of Synaptics (SYNA)

In 2022, Synaptics had 39,000,000 outstanding shares. By 2023, this increased to 39,600,000. This 600,000 share increase means they have not bought back shares but issued more. Historically, their outstanding shares have fluctuated: peaking in 2005 at 44,641,500 and hitting a low in 2019 at 33,600,000. Recently, the trend has shown an upward tick. Given that outstanding shares increased, we assign 0 points for this criterion.

Operating of Synaptics (SYNA)

Cross Margin is growing?

The change in gross margin criterion assesses if the company is now more profitable by comparing the current year's gross margin to the previous year's.

Historical gross margin of Synaptics (SYNA)

For Synaptics (SYNA), the gross margin has decreased from 0.5421 in 2022 to 0.5283 in 2023. This represents a decline in gross margin, indicating that the company is under more pressure in terms of cost management and pricing power. Over the past 20 years, the gross margin trend reveals a high of 0.5283 in 2022, suggesting that the current decline is somewhat against the recent trend of increasing profitability. Despite the decline, it is worth mentioning that the gross margin is still above the industry's last-reported median of 0.4919 in 2023. This shows that Synaptics remains more efficient than its peers in generating profit from sales, although the dip from its peak signals an area of concern that management would need to address.

Asset Turnover Ratio is growing?

Asset Turnover measures the efficiency of a company in using its assets to generate sales. It's crucial for assessing operational performance.

Historical asset turnover ratio of Synaptics (SYNA)

Comparing Synaptics' asset turnover ratio of 0.4955 in 2023 to 0.6843 in 2022, it's clear that the asset turnover has decreased. This decline signifies that the company has become less efficient in using its assets to generate revenue over the past year. For the Piotroski score, this would result in 0 points for asset turnover. Analyzing the historical data, we observe that over the last two decades, the asset turnover ratio peaked at 1.3868 in 2009 but has generally exhibited a downward trend, reflecting consistent challenges in asset utilization efficiency over the long term.


Obligatory risk notice

We would like to point out that the contents of this website are for general information purposes only and do not constitute recommendations for the purchase or sale of specific financial instruments, and therefore do not constitute investment advice. In particular, marketstorylabs.com and its creators cannot assess the extent to which information / recommendations made on the pages correspond to your investment objectives, your risk tolerance and your ability to bear losses. Therefore, if you make any investment decisions based on information on the site, you do so solely on your own responsibility and at your own risk. This in turn means that neither marketstorylabs.com nor its creators are liable for any losses incurred as a result of investment decisions based on the information on the marketstorylabs.com website or other media used.