Richard Sloan from the University of Michigan was first to document what is referred to as the "accrual anomaly". His 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones.
Forward Industries's Sloan Ratio for the quarter that ended in Dec. 2023 was -29.71%.
Warning Sign:
When sloan ratio (-26.7)% higher than 25% or lower than -25%, earnings are more likely to be made up of accruals.
As of Dec. 2023, Forward Industries has a Sloan Ratio of -29.71%, indicating earnings are more likely to be made up of accruals.
Forward Industries Sloan Ratio % Historical Data
The historical data trend for Forward Industries's Sloan Ratio % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of Forward Industries's Sloan Ratio %
For the Footwear & Accessories subindustry, Forward Industries's Sloan Ratio %, along with its competitors' market caps and Sloan Ratio % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Forward Industries's Sloan Ratio % Distribution in the Manufacturing - Apparel & Accessories Industry
For the Manufacturing - Apparel & Accessories industry and Consumer Cyclical sector, Forward Industries's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Forward Industries's Sloan Ratio % falls into.
Forward Industries Sloan Ratio % Calculation
Earnings contain a lot of non cash earnings which is called accruals. The Sloan ratio is a way to identify firms with low non-cash or accrual-derived earnings relative to their cash flow.
Forward Industries's Sloan Ratio for the fiscal year that ended in Sep. 2023 is calculated as
Forward Industries's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was -0.871 (Mar. 2023 ) + -0.537 (Jun. 2023 ) + -1.899 (Sep. 2023 ) + -0.354 (Dec. 2023 ) = $-3.66 Mil.
Forward Industries's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 0.099 (Mar. 2023 ) + 0.612 (Jun. 2023 ) + 0.479 (Sep. 2023 ) + 0.116 (Dec. 2023 ) = $1.31 Mil.
Forward Industries's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -0.025 (Mar. 2023 ) + -0.047 (Jun. 2023 ) + -0.02 (Sep. 2023 ) + -0.02 (Dec. 2023 ) = $-0.11 Mil.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Forward Industries (NAS:FORD) Sloan Ratio % Explanation
A former University of Michigan researcher, Richard Sloan's 1996 paper found that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones. In fact, for the 40-year period between 1962 and 2001, buying the lowest accrual companies and shorting the highest accrual companies resulted in an average annual compounded return of 18%, more than double the S&P 500's 7.4% annual return over the same period.
If the Sloan Ratio is between -10% and 10%, the company is in the safe zone and there is no funny business with accruals.
If the Sloan Ratio is less than between -25% and -10% on the negative side, and between 10% and 25% on the positive side, this is a warning stage of accrual build up.
If the Sloan Ratio is less than -25% or greater than 25%, and this ratio is consistent over several quarters or even years, be careful. Earnings are highly likely to be made up of accruals.
As of Dec. 2023, Forward Industries has a Sloan Ratio of -29.71%, indicating earnings are more likely to be made up of accruals.
Forward Industries Sloan Ratio % Related Terms
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Forward Industries (Forward Industries) Business Description
Forward Industries Inc is a provider of carrying and protective solutions. It designs and distributes product protection for handheld electronic devices. Forward Industries sells soft-sided carrying cases for blood glucose diagnostic kits and portable consumer electronic devices such as smartphones, tablets, personal computers, notebooks, and global Positioning System devices. It operates in two segments, the OEM distribution segment sources and distributes carrying cases and other accessories for medical monitoring and diagnostic kits and a variety of other portable electronic and non-electronic devices directly to OEMs; The design segment provides a full spectrum of hardware and software product design and engineering services. The majority of revenue is generated from the US.
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