Piotroski Score Backtest Part 2

I received some feedback on my last post regarding the Piotroski F-Score backtest. The comment suggested that I run the backtest for each of the ten discrete Piotroski Scores. I have been using quintiles for my fundamental backtests, but I did agree that in the case of the Piotroski Score it might make more sense to

Piotroski F-Score Backtest

The Piotroski F-Score is an advanced compound fundamental analysis strategy developed by Joseph D. Piotroski. Piotroski detailed this strategy in his 2002 academic paper, “Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers.”  The F-Score gives stocks one point for passing each of the following simple accounting-based fundamental tests: Positive net income

New Fat Pitch Financials Logo

I just finished drawing a new logo for Fat Pitch Financials. I wanted it to be both baseball inspired and finance themed. I settled on using the shape of a baseball, the green colors of finance, and a money inspired font. At first blush, I am pretty happy with the outcome. The true test will be what

Business Podcasts I’m Listen to this Week

Over the past few months, I’ve started incorporating podcast listening into my morning commute. It’s often easier to listen to a podcast versus trying to read a book while taking a crowded train, and while driving, it is a good alternative to just listening to music. Improvements in Apple’s iTunes Podcast app have made downloading podcasts

Introducing the Fat Pitch Financials Value Investing Video Series

Fat Pitch Financials is launching a screencast video series.  This first episode provides a brief introduction to this value investing blog. Please submit feedback on the quality of this video.  I’d also love to hear your suggestions on topics for me to cover in upcoming segments.

Building Value in 2015

Happy New Year! I hope you all had a great time with friends and family over the holidays. While visiting family, I started thinking about my New Year’s resolution for 2015. Looking back over the past few years, I’ve been rather focused on looking for value. While that has been great, I want to pivot

Value Investor Gift Ideas

Today is “Black” Friday and if you are anything like me you will be doing anything you can to avoid the malls today.  To help you avoid heavy traffic, hunting for parking spaces, long lines, and rude shoppers, I’ve put together a list of great gift ideas for value investors. The following are some of

Earnings Per Share 5 Year Growth Rate Backtest

Growth investing is often considered the opposite of value investing. However, growth fundamentals influence how a company is valued. Today, I’m going to test how the long-term earning per share 5 year growth rate impacts stock returns. The EPS 5-year growth rate I’m using for this backtest is the compound annual growth rate of earnings per share

Price to Sales Ratio Backtest

The Price-to-Sales (P/S) ratio is a commonly mentioned valuation ratio. It is similar to the P/E ratio but uses revenues instead of earnings. The advantages of using sales in this valuation ratio are two fold. First, it somewhat controls for earnings manipulation, since it is harder to manipulate sales numbers. Second, because the Price/Sales ratio does not

Price to Free Cash Flow Ratio Backtest

The Price-to-Free Cash Flow (P/FCF) ratio a popular valuation ratio among value investors. It is similar to the P/E ratio but free cash flow is just operating cash flow minus capital expenditures.  Because it relies on the Statement of Cash Flows, it is thought to be less susceptible to accounting manipulation. Free cash flow is also similar to Warren