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.
T. Rowe Price Group's Sloan Ratio for the quarter that ended in Dec. 2023 was 3.59%.
As of Dec. 2023, T. Rowe Price Group has a Sloan Ratio of 3.59%, indicating the company is in the safe zone and there is no funny business with accruals.
T. Rowe Price Group Sloan Ratio % Historical Data
The historical data trend for T. Rowe Price Group'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 T. Rowe Price Group's Sloan Ratio %
For the Asset Management subindustry, T. Rowe Price Group'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.
T. Rowe Price Group's Sloan Ratio % Distribution in the Asset Management Industry
For the Asset Management industry and Financial Services sector, T. Rowe Price Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where T. Rowe Price Group's Sloan Ratio % falls into.
T. Rowe Price Group 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.
T. Rowe Price Group's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
T. Rowe Price Group's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 421.5 (Mar. 2023 ) + 476.4 (Jun. 2023 ) + 453.2 (Sep. 2023 ) + 437.6 (Dec. 2023 ) = $1,789 Mil.
T. Rowe Price Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 511.7 (Mar. 2023 ) + 394.8 (Jun. 2023 ) + 470 (Sep. 2023 ) + -157.4 (Dec. 2023 ) = $1,219 Mil.
T. Rowe Price Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -57.5 (Mar. 2023 ) + -78.4 (Jun. 2023 ) + 174 (Sep. 2023 ) + 90.1 (Dec. 2023 ) = $128 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.
T. Rowe Price Group (NAS:TROW) 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, T. Rowe Price Group has a Sloan Ratio of 3.59%, indicating the company is in the safe zone and there is no funny business with accruals.
T. Rowe Price Group Sloan Ratio % Related Terms
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T. Rowe Price Group (T. Rowe Price Group) Business Description
T. Rowe Price provides asset-management services for individual and institutional investors. It offers a broad range of no-load U.S. and international stock, hybrid, bond, and money market funds. At the end of October 2023, the firm had $1.312 trillion in managed assets, composed of equity (51%), balanced (33%), fixed-income and money market (13%), and alternatives (3%) offerings. Approximately two thirds of the company's managed assets are held in retirement-based accounts, which provides T. Rowe Price with a somewhat stickier client base than most of its peers. The firm also manages private accounts, provides retirement planning advice, and offers discount brokerage and trust services. The company is primarily a U.S.-based asset manager, deriving just over 9% of its AUM from overseas.
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