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.
Boulder Brands's Sloan Ratio for the quarter that ended in Sep. 2015 was -3.42%.
As of Sep. 2015, Boulder Brands has a Sloan Ratio of -3.42%, indicating the company is in the safe zone and there is no funny business with accruals.
Boulder Brands Sloan Ratio % Historical Data
The historical data trend for Boulder Brands'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 Boulder Brands's Sloan Ratio %
For the Packaged Foods subindustry, Boulder Brands'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.
Boulder Brands's Sloan Ratio % Distribution in the Consumer Packaged Goods Industry
For the Consumer Packaged Goods industry and Consumer Defensive sector, Boulder Brands's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Boulder Brands's Sloan Ratio % falls into.
Boulder Brands 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.
Boulder Brands's Sloan Ratio for the fiscal year that ended in Dec. 2014 is calculated as
Boulder Brands's Net Income for the trailing twelve months (TTM) ended in Sep. 2015 was 1.821 (Dec. 2014 ) + 1.835 (Mar. 2015 ) + -3.339 (Jun. 2015 ) + 0.354 (Sep. 2015 ) = $0.7 Mil.
Boulder Brands's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2015 was 19.505 (Dec. 2014 ) + 2.407 (Mar. 2015 ) + 14.291 (Jun. 2015 ) + 0.385 (Sep. 2015 ) = $36.6 Mil.
Boulder Brands's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2015 was -6.407 (Dec. 2014 ) + -5.83 (Mar. 2015 ) + -4.67 (Jun. 2015 ) + 3.029 (Sep. 2015 ) = $-13.9 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.
Boulder Brands (NAS:BDBD) 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, Boulder Brands has a Sloan Ratio of -3.42%, indicating the company is in the safe zone and there is no funny business with accruals.
Boulder Brands Sloan Ratio % Related Terms
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Boulder Brands (Boulder Brands) Business Description
Boulder Brands Inc, a Delaware corporation was incorporated on May 31, 2005. The Company was formerly known as Smart Balance, Inc. The Company is a marketer of functional food products under the Smart Balance, Earth Balance and Bestlife trademarks. Its products are sold in mass merchandise, grocery, natural food, and club stores throughout the U.S. and Canada. The Company's health and wellness platform consists of brands that target specific health trends: the Glutino and Udi's Gluten Free brands for gluten-free diets; the Earth Balance brand for plant-based diets; the Level Life brand for diabetic diets; EVOL foods for consumers seeking pure and simple ingredients; and the Smart Balance brand for heart healthier diets. The Company distributes its products in all key retail channels, including natural, grocery, club and mass merchandise, and also has a presence in the foodservice and industrial channels. Its business consists of two reportable segments: Smart Balance and Natural. The Natural segment consists of its Glutino, Udi's, Earth Balance and EVOL branded products. The Smart Balance segment consists of its Smart Balance branded products in spreads, butter, grocery and milk and its Level Life products. A majority of its products are sold through supermarket chains and food wholesalers. Its products are available in all 50 states. The Company's products compete with branded products as well as generic and private-label products of food retailers, wholesalers and cooperatives. The Company attempts to protect its intellectual property rights through a combination of patent, trademark, copyright, and trade secret laws, as well as licensing agreements, third-party confidentiality, nondisclosure, and assignment agreements, and by policing third-party misuses of its intellectual property. The manufacturing, packaging, labeling, advertising, distribution and sale of its products are subject to regulation by various government agencies.
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