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.
Jacobs Solutions's Sloan Ratio for the quarter that ended in Dec. 2023 was -1.85%.
As of Dec. 2023, Jacobs Solutions has a Sloan Ratio of -1.85%, indicating the company is in the safe zone and there is no funny business with accruals.
Jacobs Solutions Sloan Ratio % Historical Data
The historical data trend for Jacobs Solutions'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 Jacobs Solutions's Sloan Ratio %
For the Engineering & Construction subindustry, Jacobs Solutions'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.
Jacobs Solutions's Sloan Ratio % Distribution in the Construction Industry
For the Construction industry and Industrials sector, Jacobs Solutions's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Jacobs Solutions's Sloan Ratio % falls into.
Jacobs Solutions 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.
Jacobs Solutions's Sloan Ratio for the fiscal year that ended in Sep. 2023 is calculated as
Jacobs Solutions's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 216.512 (Mar. 2023 ) + 164.239 (Jun. 2023 ) + 149.38 (Sep. 2023 ) + 171.61 (Dec. 2023 ) = $702 Mil.
Jacobs Solutions's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 132.042 (Mar. 2023 ) + 321.061 (Jun. 2023 ) + 219.363 (Sep. 2023 ) + 418.361 (Dec. 2023 ) = $1,091 Mil.
Jacobs Solutions's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -27.937 (Mar. 2023 ) + -29.749 (Jun. 2023 ) + -39.239 (Sep. 2023 ) + -15.997 (Dec. 2023 ) = $-113 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.
Jacobs Solutions (NYSE:J) 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, Jacobs Solutions has a Sloan Ratio of -1.85%, indicating the company is in the safe zone and there is no funny business with accruals.
Jacobs Solutions Sloan Ratio % Related Terms
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Jacobs Solutions (Jacobs Solutions) Business Description
Jacobs Solutions is a global provider of engineering, design, procurement, construction, and maintenance services as well as cyber engineering and security solutions. The firm serves industrial, commercial, and government clients in a wide variety of sectors, including water, transportation, healthcare, technology, and chemicals. Jacobs Solutions employs approximately 60,000 workers. The company generated $16.4 billion in revenue and $1.3 billion in adjusted operating income in fiscal 2023.
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