The Value Composite One (VC1) is a method that investors use to determine a company’s value. The Value Composite score of Sigma Healthcare Limited (ASX:SIP) is 9. A company with a value of 0 is thought to be an undervalued company, while a company with a value of 100 is considered an overvalued company. The VC1 is calculated using the price to book value, price to sales, EBITDA to EV, price to cash flow, and price to earnings. Similarly, the Value Composite Two (VC2) is calculated with the same ratios, but adds the Shareholder Yield. The Value Composite Two of Sigma Healthcare Limited (ASX:SIP) is 5.
Technicals at a Glance
In taking a look at some other notable technicals, Sigma Healthcare Limited (ASX:SIP)’s ROIC is 0.216269. The ROIC 5 year average is 0.115263 and the ROIC Quality ratio is 4.962744. ROIC is a profitability ratio that measures the return that an investment generates for those providing capital. ROIC helps show how efficient a firm is at turning capital into profits.
There are many different tools to determine whether a company is profitable or not. One of the most popular ratios is the “Return on Assets” (aka ROA). This score indicates how profitable a company is relative to its total assets. The Return on Assets for Sigma Healthcare Limited (ASX:SIP) is 0.044784. This number is calculated by dividing net income after tax by the company’s total assets. A company that manages their assets well will have a higher return, while a company that manages their assets poorly will have a lower return.
We also note that Sigma Healthcare Limited (ASX:SIP) has a Shareholder Yield of 0.069919 and a Shareholder Yield (Mebane Faber) of 0.16226. The first value is calculated by adding the dividend yield to the percentage of repurchased shares. The second value adds in the net debt repaid yield to the calculation. Shareholder yield has the ability to show how much money the firm is giving back to shareholders via a few different avenues. Companies may issue new shares and buy back their own shares. This may occur at the same time. Investors may also use shareholder yield to gauge a baseline rate of return.
Sigma Healthcare Limited (ASX:SIP) has a current MF Rank of 1795. Developed by hedge fund manager Joel Greenblatt, the intention of the formula is to spot high quality companies that are trading at an attractive price. The formula uses ROIC and earnings yield ratios to find quality, undervalued stocks. In general, companies with the lowest combined rank may be the higher quality picks.
We can now take aquick look at some historical stock price index data. Sigma Healthcare Limited (ASX:SIP) presently has a 10 month price index of 0.72500. The price index is calculated by dividing the current share price by the share price ten months ago. A ratio over one indicates an increase in share price over the period. A ratio lower than one shows that the price has decreased over that time period. Looking at some alternate time periods, the 12 month price index is 0.71311, the 24 month is 1.09467, and the 36 month is 1.33562. Narrowing in a bit closer, the 5 month price index is 0.96552, the 3 month is 0.99408, and the 1 month is currently 1.07947.
The Piotroski F-Score is a scoring system between 1-9 that determines a firm’s financial strength. The score helps determine if a company’s stock is valuable or not. The Piotroski F-Score of Sigma Healthcare Limited (ASX:SIP) is 5. A score of nine indicates a high value stock, while a score of one indicates a low value stock. The score is calculated by the return on assets (ROA), Cash flow return on assets (CFROA), change in return of assets, and quality of earnings. It is also calculated by a change in gearing or leverage, liquidity, and change in shares in issue. The score is also determined by change in gross margin and change in asset turnover.
Sigma Healthcare Limited (ASX:SIP) has a current ERP5 Rank of 2080. The ERP5 Rank may assist investors with spotting companies that are undervalued. This ranking uses four ratios. These ratios are Earnings Yield, ROIC, Price to Book, and 5 year average ROIC. When looking at the ERP5 ranking, it is generally considered the lower the value, the better.
At the time of writing, Sigma Healthcare Limited (ASX:SIP) has a Piotroski F-Score of 5. The F-Score may help discover companies with strengthening balance sheets. The score may also be used to spot the weak performers. Joseph Piotroski developed the F-Score which employs nine different variables based on the company financial statement. A single point is assigned to each test that a stock passes. Typically, a stock scoring an 8 or 9 would be seen as strong. On the other end, a stock with a score from 0-2 would be viewed as weak.
Sigma Healthcare Limited (ASX:SIP) has an M-score Beneish of -2.703609. This M-score model was developed by Messod Beneish in order to detect manipulation of financial statements. The score uses a combination of eight different variables. The specifics of the variables and formula can be found in the Beneish paper “The Detection of Earnings Manipulation”.