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Will Oxford Biomedica's (LON:OXB) share price suffer because of its poor F-Score?

Michael Green

It's hard to keep tabs on hundreds of companies, but that's what we have to do if we want to find overlooked investment opportunities. Sometimes there just isn't time to dig through the annual accounts of multiple companies, however.

Thankfully there are measures like the Piotroski F-Score, which distil a wealth of financial data into one easily comparable score. Unfortunately, what the F-Score algorithm says for Healthcare operator Oxford Biomedica (LON:OXBis not good. First a little bit more on what this number means.

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What the Piotroski F-Score says about Oxford Biomedica (LON:OXB)

The Piotroski F-Score is a nine-strong checklist split up into three sections, each looking at a different part of a company's financial situation. Unlike most ratios, the F-Score looks more deeply into the direction in which a company’s financial health is moving.

Piotroski found that weak stocks with an F-Score of 2 or less are five times more likely to either go bankrupt or delist due to financial problems. When we apply Piotroski's checklist to Oxford Biomedica, it gets a lowly F-Score of 2 out of a possible 9...

This means that not only is Oxford Biomedica (LON:OXB) financial health deteriorating, it currently fits in with the stocks that Piotroski identified as being five times more likely to go bankrupt or delist. This many not end up being the case for Oxford Biomedica, but it does suggest further research is required.

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