A composite score of financial health

Twenty years ago, University of Chicago Accounting Professor, Joseph Piotroski devised a methodology to score a company to determine the overall strength of their financial position. The stocks are rated on a score of 0 to nine based on nine parameters, nine being the best. For every criteria that is met the company is given one point, if it is not met, then no points are awarded. The points are then added up to determine the best value stocks. Piotroski said financial strength could be determined using data solely from financial statements. Since the score is based on recent performance and therefore we can say it points out to the current out per

This article was originally published on June 30, 2021.