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.
Frequency Electronics's Sloan Ratio for the quarter that ended in Jan. 2024 was 4.46%.
As of Jan. 2024, Frequency Electronics has a Sloan Ratio of 4.46%, indicating the company is in the safe zone and there is no funny business with accruals.
Frequency Electronics Sloan Ratio % Historical Data
The historical data trend for Frequency Electronics'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 Frequency Electronics's Sloan Ratio %
For the Communication Equipment subindustry, Frequency Electronics'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.
Frequency Electronics's Sloan Ratio % Distribution in the Hardware Industry
For the Hardware industry and Technology sector, Frequency Electronics's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Frequency Electronics's Sloan Ratio % falls into.
Frequency Electronics 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.
Frequency Electronics's Sloan Ratio for the fiscal year that ended in Apr. 2023 is calculated as
Frequency Electronics's Net Income for the trailing twelve months (TTM) ended in Jan. 2024 was 0.246 (Apr. 2023 ) + 2.042 (Jul. 2023 ) + 0.797 (Oct. 2023 ) + 0.13 (Jan. 2024 ) = $3.22 Mil.
Frequency Electronics's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jan. 2024 was -0.773 (Apr. 2023 ) + -2.801 (Jul. 2023 ) + -0.18 (Oct. 2023 ) + 4.207 (Jan. 2024 ) = $0.45 Mil.
Frequency Electronics's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jan. 2024 was -0.032 (Apr. 2023 ) + -0.187 (Jul. 2023 ) + -0.173 (Oct. 2023 ) + -0.311 (Jan. 2024 ) = $-0.70 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.
Frequency Electronics (NAS:FEIM) 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, Frequency Electronics has a Sloan Ratio of 4.46%, indicating the company is in the safe zone and there is no funny business with accruals.
Frequency Electronics Sloan Ratio % Related Terms
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Frequency Electronics (Frequency Electronics) Business Description
Frequency Electronics Inc is engaged in the design, development, and manufacture of high-precision timing, and frequency control products for space, air, sea, and terrestrial applications. The company has FEI-NY and FEI-Zyfer reportable segments. It derives the majority of its revenues from the FEI-NY segment. FEI-NY segment operations consist principally of precision time and frequency control products used in three principal markets namely communication satellites (both commercial and U.S. Government-funded); terrestrial cellular telephone or other ground-based telecommunication stations; and other components and systems for the U.S. military.
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