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.
Post Holdings's Sloan Ratio for the quarter that ended in Dec. 2023 was 3.52%.
As of Dec. 2023, Post Holdings has a Sloan Ratio of 3.52%, indicating the company is in the safe zone and there is no funny business with accruals.
Post Holdings Sloan Ratio % Historical Data
The historical data trend for Post Holdings'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.
For the Packaged Foods subindustry, Post Holdings'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.
Post Holdings Sloan Ratio % Distribution
For the Consumer Packaged Goods industry and Consumer Defensive sector, Post Holdings's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Post Holdings's Sloan Ratio % falls into.
Post Holdings 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.
Post Holdings's Sloan Ratio for the fiscal year that ended in Sep. 2023 is calculated as
Post Holdings's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 57.5 (Mar. 2023 ) + 89.6 (Jun. 2023 ) + 65.7 (Sep. 2023 ) + 88.1 (Dec. 2023 ) = $301 Mil.
Post Holdings's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 100 (Mar. 2023 ) + 282.2 (Jun. 2023 ) + 269.8 (Sep. 2023 ) + 174.4 (Dec. 2023 ) = $826 Mil.
Post Holdings's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -81 (Mar. 2023 ) + -433.9 (Jun. 2023 ) + -101.4 (Sep. 2023 ) + -333.8 (Dec. 2023 ) = $-950 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.
Post Holdings (NYSE:POST) 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, Post Holdings has a Sloan Ratio of 3.52%, indicating the company is in the safe zone and there is no funny business with accruals.
Post Holdings Sloan Ratio % Related Terms
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Post Holdings (Post Holdings) Business Description
Post Holdings Inc is an consumer packaged goods holding company. It operates in Post Consumer Brands which Includes branded and private label ready-to-eat cereals, Weetabix it Includes the businesses of Weetabix Limited, which Post acquired in July 2017 and which produces and distributes branded and private label RTE cereal, hot cereals and other cereal-based food products, Foodservice which Includes primarily egg and potato products in the foodservice and food ingredient channels from the businesses of MFI Holding Corporation, lastly Refrigerated Retail segment Provides refrigerated retail products, inclusive of side dishes, eggs and egg products, sausage, cheese and other dairy and refrigerated products.
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