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&E Equipment Services's Sloan Ratio for the quarter that ended in Dec. 2023 was 14.11%.
As of Dec. 2023, H&E Equipment Services has a Sloan Ratio of 14.11%, indicating there is a warning stage of accrual build up.
H&E Equipment Services Sloan Ratio % Historical Data
* 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&E Equipment Services's Sloan Ratio %
For the Rental & Leasing Services subindustry, H&E Equipment Services'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&E Equipment Services's Sloan Ratio % Distribution in the Business Services Industry
For the Business Services industry and Industrials sector, H&E Equipment Services's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where H&E Equipment Services's Sloan Ratio % falls into.
H&E Equipment Services 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&E Equipment Services's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
H&E Equipment Services's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 25.674 (Mar. 2023 ) + 41.216 (Jun. 2023 ) + 48.879 (Sep. 2023 ) + 53.524 (Dec. 2023 ) = $169 Mil.
H&E Equipment Services's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 43.225 (Mar. 2023 ) + 91.685 (Jun. 2023 ) + 141.592 (Sep. 2023 ) + 128.981 (Dec. 2023 ) = $405 Mil.
H&E Equipment Services's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -56.431 (Mar. 2023 ) + -212.484 (Jun. 2023 ) + -183.121 (Sep. 2023 ) + -156.726 (Dec. 2023 ) = $-609 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&E Equipment Services (NAS:HEES) 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, H&E Equipment Services has a Sloan Ratio of 14.11%, indicating there is a warning stage of accrual build up.
H&E Equipment Services Sloan Ratio % Related Terms
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H&E Equipment Services (H&E Equipment Services) Business Description
H&E Equipment Services Inc is an integrated equipment services company. It is focused on heavy construction and industrial equipment. It rents, sells, and provides parts and services support for four core categories of equipment including hi-lift or aerial work platform equipment, cranes, earthmoving equipment, and industrial lift trucks. It engages in five principal business activities: equipment rentals; new equipment sales; used equipment sales; parts sales; and repair and maintenance services. The majority of its revenue is derived from the equipment rentals segment.
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