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.
H.B. Fuller Co's Sloan Ratio for the quarter that ended in Feb. 2024 was 0.68%.
As of Feb. 2024, H.B. Fuller Co has a Sloan Ratio of 0.68%, indicating the company is in the safe zone and there is no funny business with accruals.
H.B. Fuller Co Sloan Ratio % Historical Data
The historical data trend for H.B. Fuller 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 H.B. Fuller Co's Sloan Ratio %
For the Specialty Chemicals subindustry, H.B. Fuller 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.
H.B. Fuller Co's Sloan Ratio % Distribution in the Chemicals Industry
For the Chemicals industry and Basic Materials sector, H.B. Fuller Co's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where H.B. Fuller Co's Sloan Ratio % falls into.
H.B. Fuller 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.
H.B. Fuller Co's Sloan Ratio for the fiscal year that ended in Nov. 2023 is calculated as
H.B. Fuller Co's Net Income for the trailing twelve months (TTM) ended in Feb. 2024 was 40.401 (May. 2023 ) + 37.627 (Aug. 2023 ) + 44.99 (Nov. 2023 ) + 30.991 (Feb. 2024 ) = $154 Mil.
H.B. Fuller Co's Cash Flow from Operations for the trailing twelve months (TTM) ended in Feb. 2024 was 102.852 (May. 2023 ) + 108.297 (Aug. 2023 ) + 161.704 (Nov. 2023 ) + 47.351 (Feb. 2024 ) = $420 Mil.
H.B. Fuller Co's Cash Flow from Investing for the trailing twelve months (TTM) ended in Feb. 2024 was -119.983 (May. 2023 ) + -115.837 (Aug. 2023 ) + -19.665 (Nov. 2023 ) + -42.725 (Feb. 2024 ) = $-298 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.
H.B. Fuller Co (NYSE:FUL) 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 Feb. 2024, H.B. Fuller Co has a Sloan Ratio of 0.68%, indicating the company is in the safe zone and there is no funny business with accruals.
H.B. Fuller Co Sloan Ratio % Related Terms
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H.B. Fuller Co (H.B. Fuller Co) Business Description
H.B. Fuller Co manufactures and sells adhesives, sealants, and other chemical-based products. The company organizes itself into three business units: constructions, engineering, and hygiene, health and consumable adhesives. It generates the most revenue from hygiene, health and consumable adhesives. This business manufactures and supplies adhesives products in the assembly, packaging, converting, nonwoven and hygiene, health and beauty, flexible packaging, graphic arts, and envelope markets. The company generates around half of its revenue in the United States, with the remainder spread across 35 countries. The company has put an emphasis on environmentally friendly products, aligning with a trend of environmental, social, and governance investing.
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