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.
Web.com Group's Sloan Ratio for the quarter that ended in Jun. 2018 was -3.51%.
As of Jun. 2018, Web.com Group has a Sloan Ratio of -3.51%, indicating the company is in the safe zone and there is no funny business with accruals.
Web.com Group Sloan Ratio % Historical Data
The historical data trend for Web.com Group'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 Web.com Group's Sloan Ratio %
For the Internet Content & Information subindustry, Web.com Group'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.
Web.com Group's Sloan Ratio % Distribution in the Interactive Media Industry
For the Interactive Media industry and Communication Services sector, Web.com Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Web.com Group's Sloan Ratio % falls into.
Web.com Group 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.
Web.com Group's Sloan Ratio for the fiscal year that ended in Dec. 2017 is calculated as
Web.com Group's Net Income for the trailing twelve months (TTM) ended in Jun. 2018 was 8.301 (Sep. 2017 ) + 30.766 (Dec. 2017 ) + 4.576 (Mar. 2018 ) + 6.212 (Jun. 2018 ) = $49.9 Mil.
Web.com Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2018 was 33.864 (Sep. 2017 ) + 38.99 (Dec. 2017 ) + 27.165 (Mar. 2018 ) + 31.303 (Jun. 2018 ) = $131.3 Mil.
Web.com Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2018 was -6.219 (Sep. 2017 ) + -13.37 (Dec. 2017 ) + -5.033 (Mar. 2018 ) + -4.116 (Jun. 2018 ) = $-28.7 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.
Web.com Group (NAS:WEB) 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 Jun. 2018, Web.com Group has a Sloan Ratio of -3.51%, indicating the company is in the safe zone and there is no funny business with accruals.
Web.com Group Sloan Ratio % Related Terms
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Web.com Group (Web.com Group) Business Description
Web.com Group Inc provides a range of internet services to small businesses to help them compete and succeed online. The company offers a range of Web services and products that enable small businesses to establish, maintain, promote, and optimize their online presence. It meets the needs of small businesses anywhere along their lifecycle with affordable, subscription-based solutions including domains, hosting, website design and management, search engine optimization, online marketing campaigns, local sales leads, social media, mobile products and E-commerce solutions. Geographically, the group operates through the market of United States and derives revenue through source of subscription.
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