The Piotroski Score is a financial metric used to assess a company’s financial health by assigning a score based on nine criteria. Developed by Professor Joseph Piotroski, this score helps investors evaluate whether a company’s financial situation is improving or declining.
The criteria include factors such as profitability (positive net income and return on assets), cash flow (positive operating cash flow and cash flow exceeding net income), debt management (reduction in long-term debt), liquidity (increase in the current ratio), equity issuance (no new shares issued), and operational efficiency (increase in gross margin and asset turnover).
Each of these factors is assigned one point, and the total score ranges from 0 to 9. A higher score (7-9) indicates a financially strong company, while a lower score (0-3) suggests potential weaknesses.
The stocks to watch out
HAL (Hindustan Aeronautics Limited)
HAL is an Indian government-owned aerospace and defense company. It designs, manufactures, and maintains aircraft, helicopters, and related systems. HAL plays a vital role in India’s defense sector and supports both military and civilian aviation. It also engages in research and development for advanced aerospace technologies.
The company’s revenue rose by 6.7 percent from Rs 6,105.07 crore to Rs 6,518.7 crore in Q2FY24-25. Meanwhile, Net profit rose from Rs 1,236.7 crores to Rs 1,510.48 crore during the same period.
With a Market Capitalisation of Rs. 2,70,977 crores, the stock is trading at a discount of 31 percent from the 52 week high of Rs. 5,675
ABB India Ltd
ABB India Ltd is a global leader in electrification, robotics, and automation technologies, the company provides sustainable solutions for industries such as energy, utilities, and manufacturing. ABB is known for its innovations in power grids, robotics, and automation systems. The company focuses on improving efficiency and reducing environmental impact.
The company’s revenue rose by 5.5 percent from Rs 2,846.01 crore to Rs 3,005.05 crore in Q2FY24-25. Meanwhile, Net profit rose from Rs 362.87 crores to Rs 440.45 crore during the same period.
With a Market Capitalisation of Rs. 1,33,069 crores, the stock is trading at a discount of 32 percent from the 52 week high of Rs. 9,200
RVNL (Rail Vikas Nigam Limited)
RVNL is an Indian public sector enterprise under the Ministry of Railways. It focuses on the development and implementation of railway infrastructure projects, including track laying, electrification, and station modernization. RVNL plays a key role in India’s rail network expansion and modernization efforts. It also undertakes project management and consultancy services.
The company’s revenue declined by 1.4 percent from Rs 5,210.34 crore to Rs 5,136.07 crore in Q2FY24-25. Meanwhile, Net profit declined from Rs 394.42 crores to Rs 286.88 crore during the same period.
With a Market Capitalisation of Rs. 87,466 crores, the stock is trading at a discount of 37 percent from the 52 week high of Rs. 647.
Hitachi Energy Ltd
Hitachi Energy is a global leader in energy technology solutions. It specializes in electrical power grids, automation, and energy management systems. A subsidiary of Hitachi Ltd., the company focuses on improving energy efficiency and sustainability. It offers cutting-edge solutions to utilities, industries, and infrastructure projects worldwide.
The company’s revenue rose by 26.5 percent from Rs 1,228.16 crore to Rs 1,553.83 crore in Q2FY24-25. Meanwhile, Net profit rose from Rs 24.74 crores to Rs 52.29 crore during the same period.
With a Market Capitalisation of Rs. 54,572 crores, the stock is trading at a discount of 27 percent from the 52 week high of Rs. 16,534.50.
KPIT Technologies Ltd
KPIT Technologies is an Indian IT and engineering services company specializing in digital transformation. It offers solutions in automotive, manufacturing, and energy sectors, focusing on areas like cloud computing, AI, and embedded systems. The company is known for its work in automotive technologies, particularly in autonomous driving and embedded software.
The company’s revenue rose by 26 percent from Rs 1,208.63 crore to Rs 1,523.31 crore in Q2FY24-25. Meanwhile, Net profit rose from Rs 140.85 crores to Rs 203.75 crore during the same period.
With a Market Capitalisation of Rs. 35,985 crores, the stock is trading at a discount of 33 percent from the 52 week high of Rs. 1,928.75.
Written by Sridhar J
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