The Fundamental Health Trend Meter gives a visual representation of the trend in a company's accounts and its overall financial health. It is based on the Piotroski F-Score, a nine-criteria scoring system developed by financial academic, Joseph Piotroski in a famous research paper. Each of the nine points relate to the change in a ratio based on the company's accounts.
Companies with a score of 8 or 9 have been found as a group to outperform weak stocks by 7.5% annually over a 20 year period. The weakest stocks, scoring 2 or lower, were found by Piotroski to be five times more likely to fall into financial problems.
Vodafone has an F-Score of 6 indicating
the company's financial situation is typical for a stable company.
"A positive earnings trend is suggestive of an improvement in the firm’s underlying ability to generate positive future cash flows."