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.
Digital Realty Trust's Sloan Ratio for the quarter that ended in Dec. 2023 was 0.97%.
As of Dec. 2023, Digital Realty Trust has a Sloan Ratio of 0.97%, indicating the company is in the safe zone and there is no funny business with accruals.
Digital Realty Trust Sloan Ratio % Historical Data
The historical data trend for Digital Realty Trust'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 Digital Realty Trust's Sloan Ratio %
For the REIT - Specialty subindustry, Digital Realty Trust'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.
Digital Realty Trust's Sloan Ratio % Distribution in the REITs Industry
For the REITs industry and Real Estate sector, Digital Realty Trust's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Digital Realty Trust's Sloan Ratio % falls into.
Digital Realty Trust 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.
Digital Realty Trust's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Digital Realty Trust's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 68.726 (Mar. 2023 ) + 118.184 (Jun. 2023 ) + 733.618 (Sep. 2023 ) + 28.31 (Dec. 2023 ) = $949 Mil.
Digital Realty Trust's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 349.726 (Mar. 2023 ) + 464.388 (Jun. 2023 ) + 358.361 (Sep. 2023 ) + 462.305 (Dec. 2023 ) = $1,635 Mil.
Digital Realty Trust's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -749.007 (Mar. 2023 ) + -529.999 (Jun. 2023 ) + 1180.3 (Sep. 2023 ) + -1016.405 (Dec. 2023 ) = $-1,115 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.
Digital Realty Trust (NYSE:DLR) 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, Digital Realty Trust has a Sloan Ratio of 0.97%, indicating the company is in the safe zone and there is no funny business with accruals.
Digital Realty Trust Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of Digital Realty Trust's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
Digital Realty Trust (Digital Realty Trust) Business Description
Digital Realty owns and operates over 300 data centers worldwide. It has nearly 40 million rentable square feet across five continents. Digital's offerings range from retail co-location, where an enterprise may rent a single cabinet and rely on Digital to provide all the accommodations, to "cold shells," where hyperscale cloud service providers can simply rent much, or all, of a barren, power-connected building. In recent years, Digital Realty has de-emphasized cold shells and now primarily provides higher-level service to tenants, which outsource their related IT needs to Digital. Digital Realty has also moved more into the co-location business, increasingly serving enterprises and facilitating network and cloud connections. Digital Realty operates as a real estate investment trust.
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