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.
Best Buy Co's Sloan Ratio for the quarter that ended in Jan. 2024 was 3.69%.
As of Jan. 2024, Best Buy Co has a Sloan Ratio of 3.69%, indicating the company is in the safe zone and there is no funny business with accruals.
Best Buy Co Sloan Ratio % Historical Data
The historical data trend for Best Buy Co'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 Best Buy Co's Sloan Ratio %
For the Specialty Retail subindustry, Best Buy Co'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.
Best Buy Co Sloan Ratio % Distribution
For the Retail - Cyclical industry and Consumer Cyclical sector, Best Buy Co's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Best Buy Co's Sloan Ratio % falls into.
Best Buy Co 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.
Best Buy Co's Sloan Ratio for the fiscal year that ended in Jan. 2024 is calculated as
Best Buy Co's Net Income for the trailing twelve months (TTM) ended in Jan. 2024 was 244 (Apr. 2023 ) + 274 (Jul. 2023 ) + 263 (Oct. 2023 ) + 460 (Jan. 2024 ) = $1,241 Mil.
Best Buy Co's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jan. 2024 was -331 (Apr. 2023 ) + 512 (Jul. 2023 ) + 109 (Oct. 2023 ) + 1180 (Jan. 2024 ) = $1,470 Mil.
Best Buy Co's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jan. 2024 was -204 (Apr. 2023 ) + -177 (Jul. 2023 ) + -219 (Oct. 2023 ) + -181 (Jan. 2024 ) = $-781 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.
Best Buy Co (NYSE:BBY) 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 Jan. 2024, Best Buy Co has a Sloan Ratio of 3.69%, indicating the company is in the safe zone and there is no funny business with accruals.
Best Buy Co Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of Best Buy Co's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
With $46.3 billion in consolidated fiscal 2023 sales, Best Buy is the largest pure-play consumer electronics retailer in the U.S., boasting roughly 8.5% share of the U.S. market and north of 35% share of offline sales, per our calculations, CTA, and Euromonitor data. The firm generates the bulk of its sales in-store, with mobile phones and tablets, computers, and appliances representing its three largest categories. Recent investments in e-commerce fulfillment, accelerated by the COVID-19 pandemic, have seen the U.S. e-commerce channel roughly double from prepandemic levels, with management estimating that it will represent a mid-30% proportion of sales moving forward.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
BBY has been successfully added to your 