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.
Heritage Oaks Bancorp's Sloan Ratio for the quarter that ended in Dec. 2016 was 7.40%.
As of Dec. 2016, Heritage Oaks Bancorp has a Sloan Ratio of 7.40%, indicating the company is in the safe zone and there is no funny business with accruals.
Heritage Oaks Bancorp Sloan Ratio % Historical Data
The historical data trend for Heritage Oaks Bancorp'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 Heritage Oaks Bancorp's Sloan Ratio %
For the Banks - Regional subindustry, Heritage Oaks Bancorp'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.
Heritage Oaks Bancorp's Sloan Ratio % Distribution in the Banks Industry
For the Banks industry and Financial Services sector, Heritage Oaks Bancorp's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Heritage Oaks Bancorp's Sloan Ratio % falls into.
Heritage Oaks Bancorp 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.
Heritage Oaks Bancorp's Sloan Ratio for the fiscal year that ended in Dec. 2016 is calculated as
Heritage Oaks Bancorp's Net Income for the trailing twelve months (TTM) ended in Dec. 2016 was 3.985 (Mar. 2016 ) + 4.215 (Jun. 2016 ) + 4.183 (Sep. 2016 ) + 4.55 (Dec. 2016 ) = $16.93 Mil.
Heritage Oaks Bancorp's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2016 was 9.549 (Mar. 2016 ) + 5.226 (Jun. 2016 ) + 9.397 (Sep. 2016 ) + 3.452 (Dec. 2016 ) = $27.62 Mil.
Heritage Oaks Bancorp's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2016 was -39.385 (Mar. 2016 ) + -42.606 (Jun. 2016 ) + -21.982 (Sep. 2016 ) + -56.538 (Dec. 2016 ) = $-160.51 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.
Heritage Oaks Bancorp (NAS:HEOP) 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. 2016, Heritage Oaks Bancorp has a Sloan Ratio of 7.40%, indicating the company is in the safe zone and there is no funny business with accruals.
Heritage Oaks Bancorp Sloan Ratio % Related Terms
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Heritage Oaks Bancorp (Heritage Oaks Bancorp) Business Description
Heritage Oaks Bancorp is a California corporation organized in 1994 and registered as a bank holding company. The Company acquired all of the outstanding common stock of Heritage Oaks Bank (Bank) and its subsidiaries in 1994. The Bank is a community-oriented financial services firm that provides banking products and services to small and medium sized businesses and consumers. Products and services are offered primarily through 12 retail branches located on the Central Coast of California, in San Luis Obispo and Santa Barbara Counties and through other direct channels, including two loan production offices in Santa Barbara and Ventura Counties. The Bank offers to its commercial clients commercial loans secured by real estate, other commercial loans and lines of credit, agricultural loans, construction financing, other real estate loans and SBA loans. For consumers, the Bank offers residential mortgages, equity lines of credit and other consumer loans. Deposit products offered include personal and business checking and savings accounts, time deposit accounts, individual retirement accounts ("IRAs") and money market accounts. The Bank also offers online banking, mobile banking, wire transfers, safe deposit boxes, cashier's checks, traveler's checks, bank-by-mail, night depository services and other customary banking services. The Company's competitors include money center banks and large regional banks. Competition also includes other community-focused commercial banks. As a bank holding company, the Company is regulated under the Bank Holding Company Act ("BHC Act") and is subject to inspection, examination and supervision by the Federal Reserve. It is also subject to the California Financial Code, as well as limited oversight by the DBO and the FDIC.
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