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.
HomeAway's Sloan Ratio for the quarter that ended in Sep. 2015 was 0.18%.
As of Sep. 2015, HomeAway has a Sloan Ratio of 0.18%, indicating the company is in the safe zone and there is no funny business with accruals.
HomeAway Sloan Ratio % Historical Data
The historical data trend for HomeAway'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 HomeAway's Sloan Ratio %
For the Internet Content & Information subindustry, HomeAway'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.
HomeAway's Sloan Ratio % Distribution in the Interactive Media Industry
For the Interactive Media industry and Communication Services sector, HomeAway's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where HomeAway's Sloan Ratio % falls into.
HomeAway 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.
HomeAway's Sloan Ratio for the fiscal year that ended in Dec. 2014 is calculated as
HomeAway's Net Income for the trailing twelve months (TTM) ended in Sep. 2015 was 0.162 (Dec. 2014 ) + -2.088 (Mar. 2015 ) + -2.387 (Jun. 2015 ) + 10.417 (Sep. 2015 ) = $6.1 Mil.
HomeAway's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2015 was 33.949 (Dec. 2014 ) + 50.656 (Mar. 2015 ) + 43.798 (Jun. 2015 ) + 24.64 (Sep. 2015 ) = $153.0 Mil.
HomeAway's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2015 was -31.165 (Dec. 2014 ) + -60.726 (Mar. 2015 ) + 69.19 (Jun. 2015 ) + -127.037 (Sep. 2015 ) = $-149.7 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.
HomeAway (NAS:AWAY) 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 Sep. 2015, HomeAway has a Sloan Ratio of 0.18%, indicating the company is in the safe zone and there is no funny business with accruals.
HomeAway Sloan Ratio % Related Terms
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HomeAway, Inc., was incorporated in 2004 as CEH Holdings, Inc. in the State of Delaware. In 2006, the Company changed its name to HomeAway, Inc. The Company operates as an online marketplace for the vacation rental industry. Vacation rentals are fully furnished, privately owned residential properties, including homes, condominiums, villas and cabins that can be rented on a nightly, weekly or monthly basis. The Company's marketplace brings together millions of travelers seeking vacation rentals online with hundreds of thousands of owners and managers of vacation rental properties located in over 145 countries around the world. Its ambition is to make every vacation rental in the world available to every traveler in the world through its online marketplace. The Company's Products and Services includes Paid Listings. Paid listings appear in search results on websites when travelers search for vacation rentals based on location, type of property, size or other characteristics. A paid listing provides the property owner or manager with a set of tools for managing an availability calendar, reservations, inquiries and the content of the listing; Transaction-Based Listings: The Company offers property managers with large inventories of vacation rentals the opportunity to post listings for no initial up-front fees and, instead, charge fees based on the number of inquiries and online reservations that result from their listing on its websites; Property Management Software: Property managers can use Company's enterprise software solutions to manage their businesses, customers and properties. It provides software solutions to property managers under the brand names Escapia, PropertyPlus, V12, Entech and First Resort and offer software tailored to professional. Its strategies to achieve goal includes: Increase the Size of Marketplace by Providing the Online Experience: It intends to build on its market scale by providing the online experience for travelers, property owners and managers. For travelers, the Company will leverage the scale and scope of the current listings on marketplace, the latest web technologies and own innovations in user interface, visual design, features and functionality; Bring More Choice and Value to Property Owners, Managers and Traveler. It derives its revenue from paid listings from its property owners and managers. The Company's customers generally pay for their listings at the beginning of the listing term, and revenue is recognized monthly over the term of the listing, which is generally one year.
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