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Valinvest

A value investing tool based on Warren Buffett, Joseph Piotroski and Benjamin Graham thoughts

Welcome to Valinvest

🔥 Important update 🔥

The Financial API used by valinvest to get financial data has been rewritten and now requires a API Key in order to make request. So, the first step now is to register on https://financialmodelingprep.com/login and get an API key. Keep it, you will need it to use valinvest ;)

✨tl;dr ✨

For a given stock ticker, valinvest calculates a score from 0 to 9. The higher the score, the better the company is according to the scoring methodology.

  1. Install it
pip install valinvest
  1. Calculate score
>>> import valinvest
>>> aapl = valinvest.Fundamental('AAPL', YOUR_API_KEY)
>>> aapl.fscore()
6.8

Table of contents 📚

Introduction

The aim of the package is to evaluate a stock according to his fundamentals by setting a score and identify buy and sells opportunies through technical indicators.

Methodology description

The scoring methodology is based on Joseph Piotroski's study (Value Investing: The Use of Historical Financial Statement Information to Separate Winners from Losers). The F-Score is used to help financial investment decisions by finding the best value stocks on the market.

The Piostroski score is calculated based on 9 criteria divided into 3 groups:

Profitability

  • Return on Assets (1 point if it is positive in the current year, 0 otherwise)
  • Operating Cash Flow (1 point if it is positive in the current year, 0 otherwise)
  • Change in Return of Assets (ROA) (1 point if ROA is higher in the current year compared to the previous one, 0 otherwise)
  • Accruals (1 point if Operating Cash Flow/Total Assets is higher than ROA in the current year, 0 otherwise)

Leverage, Liquidity and Source of Funds

  • Change in Leverage (long-term) ratio (1 point if the ratio is lower this year compared to the previous one, 0 otherwise)
  • Change in Current ratio (1 point if it is higher in the current year compared to the previous one, 0 otherwise)
  • Change in the number of shares (1 point if no new shares were issued during the last year)

Operating Efficiency

  • Change in Gross Margin (1 point if it is higher in the current year compared to the previous one, 0 otherwise)
  • Change in Asset Turnover ratio (1 point if it is higher in the current year compared to the previous one, 0 otherwise)

This software calculates an alternate version of the F-Score as follows:

Growth

  • Net Revenue
  • EBITDA
  • Earnings per share (EPS)

Profitability

  • CROIC
  • ROIC

Debts

  • EBITDA cover ratio
  • Debt coverage

Market sensibility

  • Beta

Investment

  • Equity buyback

Installation

pip install valinvest

Examples

Starbucks Corporation (SBUX)

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Score
REV_G 1 1 1 1 1 1 1 1 1 1 1
EBT_G 1 1 1 0 1 1 1 0 0 1 0.7
EPS_G 1 1 1 0 1 0 1 1 1 0 0.7
ROIC 0 0 1 0 0 0 0 0 0 0 0 0.1
CROIC 1 1 1 1 1 0 1 1 1 1 1 0.9
5YRS_BETA 1
EBITDA_COVER 1 1 1 1 1 1 1 1 1 1 1 1
DEBT_COST 0 0 0 0 1 1 1 1 1 1 1 0.7
EQ_BUYBACK 1 0 0 1 0 0 1 1 1 1 0.6
F-SCORE 6.7
>>> import valinvest
>>> sbux = valinvest.Fundamental('SBUX')
>>> sbux.fscore()
6.7

Apple Inc. (AAPL)

2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 2019 Score
REV_G 1 1 1 1 1 1 0 1 1 0 0.8
EBT_G 1 1 1 0 1 1 0 1 1 0 0.7
EPS_G 1 1 1 0 0 1 0 1 1 0 0.6
ROIC 1 1 1 1 1 1 1 1 1 1 1 1
CROIC 1 1 1 1 1 1 1 1 1 1 1 1
5YRS_BETA 0
EBITDA_COVER 1 1 1 1 1 1 1 1 1 1 1 1
DEBT_COST 1 1 1 1 1 1 1 1 1 1 1 1
EQ_BUYBACK 1 0 0 1 0 1 1 1 1 1 0.7
F-SCORE 6.8
>>> import valinvest
>>> aapl = valinvest.Fundamental('AAPL')
>>> aapl.fscore()
6.8

License

This project is licensed under the MIT License - see the LICENSE.md file for details

Credits

This software uses code from several open source packages: