Planet Fitness, Inc. (NYSE:PLNT) and Weight Watchers International, Inc. (NasdaqGS:WTW) Quants in Focus

The Piotroski F-Score of Planet Fitness, Inc. (NYSE:PLNT) is 6.  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.  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.

For any technician, the trend is a major aspect of stock trading. The trend is the dominant movement in direction of a stock’s price. When discussing the trend in terms of stock price, the assumption is that the trend is expected to continue over a certain period of time. Obviously there is no guarantee that a defined trend will continue, but technical analysts will scour the charts looking for signs of a developed trend to help make the best possible decisions. Seasoned chart watchers are typically able to spot if a trend is up, down, or sideways. Learning how to trade the trend is another part of the process that traders may spend years perfecting.

Volatility/PI
Stock volatility is a percentage that indicates whether a stock is a desirable purchase. Investors look at the Volatility 12m to determine if a company has a low volatility percentage or not over the course of a year. The Volatility 12m of Planet Fitness, Inc. (NYSE:PLNT) is 29.750100. This is calculated by taking weekly log normal returns and standard deviation of the share price over one year annualized. The lower the number, a company is thought to have low volatility. The Volatility 3m is a similar percentage determined by the daily log normal returns and standard deviation of the share price over 3 months. The Volatility 3m of Planet Fitness, Inc. (NYSE:PLNT) is 26.141000. The Volatility 6m is the same, except measured over the course of six months. The Volatility 6m is 41.876500.

The Price Index is a ratio that indicates the return of a share price over a past period. The price index of Planet Fitness, Inc. (NYSE:PLNT) for last month was 1.14923. This is calculated by taking the current share price and dividing by the share price one month ago. If the ratio is greater than 1, then that means there has been an increase in price over the month. If the ratio is less than 1, then we can determine that there has been a decrease in price. Similarly, investors look up the share price over 12 month periods. The Price Index 12m for Planet Fitness, Inc. (NYSE:PLNT) is 1.75297.

Further, we can see that Planet Fitness, Inc. (NYSE:PLNT) has a Shareholder Yield of -0.027814 and a Shareholder Yield (Mebane Faber) of -0.03821. 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.

Checking in on some valuation rankings, Planet Fitness, Inc. (NYSE:PLNT) has a Value Composite score of 75. Developed by James O’Shaughnessy, the VC score uses five valuation ratios. These ratios are price to earnings, price to cash flow, EBITDA to EV, price to book value, and price to sales. The VC is displayed as a number between 1 and 100. In general, a company with a score closer to 0 would be seen as undervalued, and a score closer to 100 would indicate an overvalued company. Adding a sixth ratio, shareholder yield, we can view the Value Composite 2 score which is currently sitting at 76.

Planet Fitness, Inc. (NYSE:PLNT) has a current MF Rank of 6478. 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.

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 Planet Fitness, Inc. (NYSE:PLNT) is 0.080571. 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.

Investors may be interested in viewing the Gross Margin score on shares of Planet Fitness, Inc. (NYSE:PLNT). The name currently has a score of 50.00000. This score is derived from the Gross Margin (Marx) stability and growth over the previous eight years. The Gross Margin score lands on a scale from 1 to 100 where a score of 1 would be considered positive, and a score of 100 would be seen as negative.

Investors considering positions in Weight Watchers International, Inc. (NasdaqGS:WTW), might be interested in the Gross Margin Score of the company. The shares currently have a score of 37.00000. This score is derived from the Gross Margin (Marx) stability and growth over the previous eight years. The Gross Margin score lands on a scale from 1 to 100 where a score of 1 would be considered positive, and a score of 100 would be seen as negative.  The low score of 37.00000 for Weight Watchers International, Inc. indicates a top score for stability and growth.

Free Cash Flow Growth (FCF Growth) is the free cash flow of the current year minus the free cash flow from the previous year, divided by last year’s free cash flow. The FCF Growth of Weight Watchers International, Inc. (NasdaqGS:WTW) is -1.000000. Free cash flow (FCF) is the cash produced by the company minus capital expenditure. This cash is what a company uses to meet its financial obligations, such as making payments on debt or to pay out dividends.

The Free Cash Flow Score (FCF Score) is a helpful tool in calculating the free cash flow growth with free cash flow stability – this gives investors the overall quality of the free cash flow. The FCF Score of Weight Watchers International, Inc. (NasdaqGS:WTW) is -0.151253. Experts say the higher the value, the better, as it means that the free cash flow is high, or the variability of free cash flow is low or both.

The Return on Invested Capital (aka ROIC) for Weight Watchers International, Inc. (NasdaqGS:WTW) is 3.460413. The Return on Invested Capital is a ratio that determines whether a company is profitable or not. It tells investors how well a company is turning their capital into profits. The ROIC is calculated by dividing the net operating profit (or EBIT) by the employed capital. The employed capital is calculated by subrating current liabilities from total assets. Similarly, the Return on Invested Capital Quality ratio is a tool in evaluating the quality of a company’s ROIC over the course of five years. The ROIC Quality of Weight Watchers International, Inc. (NasdaqGS:WTW) is 3.734275. This is calculated by dividing the five year average ROIC by the Standard Deviation of the 5 year ROIC. The ROIC 5 year average is calculated using the five year average EBIT, five year average (net working capital and net fixed assets). The ROIC 5 year average of Weight Watchers International, Inc. (NasdaqGS:WTW) is 3.160220.

Shareholder Yield

The Shareholder Yield is a way that investors can see how much money shareholders are receiving from a company through a combination of dividends, share repurchases and debt reduction. The Shareholder Yield of Weight Watchers International, Inc. (NasdaqGS:WTW) is -0.035751. This percentage is calculated by adding the dividend yield plus the percentage of shares repurchased. Dividends are a common way that companies distribute cash to their shareholders. Similarly, cash repurchases and a reduction of debt can increase the shareholder value, too. Another way to determine the effectiveness of a company’s distributions is by looking at the Shareholder yield (Mebane Faber). The Shareholder Yield (Mebane Faber) of Weight Watchers International, Inc. NasdaqGS:WTW is 0.03113. This number is calculated by looking at the sum of the dividend yield plus percentage of sales repurchased and net debt repaid yield.

The Value Composite One (VC1) is a method that investors use to determine a company’s value. The VC1 of Weight Watchers International, Inc. (NasdaqGS:WTW) is 40. 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 Weight Watchers International, Inc. (NasdaqGS:WTW) is 49.

ERP5 Rank

The ERP5 Rank is an investment tool that analysts use to discover undervalued companies. The ERP5 looks at the Price to Book ratio, Earnings Yield, ROIC and 5 year average ROIC. The ERP5 of Weight Watchers International, Inc. (NasdaqGS:WTW) is 3323. The lower the ERP5 rank, the more undervalued a company is thought to be.

C-Score – Montier

Weight Watchers International, Inc. (NasdaqGS:WTW) currently has a Montier C-score of -1.00000. This indicator was developed by James Montier in an attempt to identify firms that were cooking the books in order to appear better on paper. The score ranges from zero to six where a 0 would indicate no evidence of book cooking, and a 6 would indicate a high likelihood. A C-score of -1 would indicate that there is not enough information available to calculate the score. Montier used six inputs in the calculation. These inputs included a growing difference between net income and cash flow from operations, increasing receivable days, growing day’s sales of inventory, increasing other current assets, decrease in depreciation relative to gross property plant and equipment, and high total asset growth.

F Score

At the time of posting, Weight Watchers International, Inc. (NasdaqGS:WTW) has a Piotroski F-Score of 6. 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.