TSLATesla

A weighted sum of five balance-sheet ratios that has historically separated companies heading for bankruptcy from the rest.

Working capital / total assets

0.224

Retained earnings / total assets

0.273

EBIT / total assets

0.029

Market value of equity / total liabilities

20.53

Revenue / total assets

0.698

Eight ratios that tend to move when reported earnings are being flattered. Above −1.78 the model flags the company.

Days' sales in receivables

1.07

Gross margin

0.99

Asset quality

1.22

Sales growth

0.97

Depreciation

1.00

SG&A expense

1.17

Total accruals / assets

-0.079

Leverage

0.99

A model of the probability of default within two years, from size, leverage, liquidity and profitability.

O-Score

-3.22

Total liabilities / total assets

0.411

Working capital / total assets

0.224

Current liabilities / current assets

0.515

Net income / total assets

0.026

Eight tests built for growth companies, each comparing the company with the median of its industry.

• Return on assets above industry medianpassed
• Cash-flow return on assets above medianpassed
• Cash flow above net incomepassed
• Earnings steadier than peersfailed
• Sales growth steadier than peersfailed
• R&D intensity above medianpassed
• Capital spending intensity above medianpassed
• Advertising intensity above medianfailed

Compared with 104 companies in the same industry group (SIC 37).

Greenblatt's ranking: cheap on earnings yield and good on return on capital, each ranked across the universe and the ranks added.

Earnings yield (EBIT / EV)

0.31%

Return on capital

5.1%

Earnings-yield rank

2,108

Return-on-capital rank

1,797

A rank, not a grade: lower is better, and it moves with the price as well as the business.

How much of reported profit arrived as cash. The Sloan ratio is the accrued, non-cash share of earnings against assets.

Cash flow to net income

4.8×

Cash-flow return on invested capital

6.0%