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.
Taiwan Semiconductor Manufacturing Co's Sloan Ratio for the quarter that ended in Dec. 2023 was 9.12%.
As of Dec. 2023, Taiwan Semiconductor Manufacturing Co has a Sloan Ratio of 9.12%, indicating the company is in the safe zone and there is no funny business with accruals.
Taiwan Semiconductor Manufacturing Co Sloan Ratio % Historical Data
The historical data trend for Taiwan Semiconductor Manufacturing Co'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.
* Premium members only.
Taiwan Semiconductor Manufacturing Co Annual Data
Trend
Dec14
Dec15
Dec16
Dec17
Dec18
Dec19
Dec20
Dec21
Dec22
Dec23
Sloan Ratio %
8.73
7.02
8.50
11.55
9.09
Taiwan Semiconductor Manufacturing Co Quarterly Data
Mar19
Jun19
Sep19
Dec19
Mar20
Jun20
Sep20
Dec20
Mar21
Jun21
Sep21
Dec21
Mar22
Jun22
Sep22
Dec22
Mar23
Jun23
Sep23
Dec23
Sloan Ratio %
11.80
10.90
12.58
12.32
9.12
Competitive Comparison
For the Semiconductors subindustry, Taiwan Semiconductor Manufacturing Co'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.
Taiwan Semiconductor Manufacturing Co Sloan Ratio % Distribution
For the Semiconductors industry and Technology sector, Taiwan Semiconductor Manufacturing Co's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Taiwan Semiconductor Manufacturing Co's Sloan Ratio % falls into.
Taiwan Semiconductor Manufacturing Co 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.
Taiwan Semiconductor Manufacturing Co's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Taiwan Semiconductor Manufacturing Co's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 6778.621 (Mar. 2023 ) + 5894.814 (Jun. 2023 ) + 6584.797 (Sep. 2023 ) + 7638.353 (Dec. 2023 ) = $26,897 Mil.
Taiwan Semiconductor Manufacturing Co's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 12616.415 (Mar. 2023 ) + 5422.998 (Jun. 2023 ) + 9195.165 (Sep. 2023 ) + 12633.933 (Dec. 2023 ) = $39,869 Mil.
Taiwan Semiconductor Manufacturing Co's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -8915.343 (Mar. 2023 ) + -8408.621 (Jun. 2023 ) + -7559.824 (Sep. 2023 ) + -4234.021 (Dec. 2023 ) = $-29,118 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.
Taiwan Semiconductor Manufacturing Co (NYSE:TSM) 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, Taiwan Semiconductor Manufacturing Co has a Sloan Ratio of 9.12%, indicating the company is in the safe zone and there is no funny business with accruals.
Taiwan Semiconductor Manufacturing Co Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of Taiwan Semiconductor Manufacturing Co's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
Taiwan Semiconductor Manufacturing Co (Taiwan Semiconductor Manufacturing Co) Business Description
Taiwan Semiconductor Manufacturing Co. is the world's largest dedicated chip foundry, with almost 60% market share. TSMC was founded in 1987 as a joint venture of Philips, the government of Taiwan, and private investors. It went public as an ADR in the U.S. in 1997. TSMC's scale and high-quality technology allow the firm to generate solid operating margins, even in the highly competitive foundry business. Furthermore, the shift to the fabless business model has created tailwinds for TSMC. The foundry leader has an illustrious customer base, including Apple, AMD, and Nvidia, that looks to apply cutting-edge process technologies to its semiconductor designs. TSMC employs more than 73,000 people.
Taiwan Semiconductor Manufacturing Co (Taiwan Semiconductor Manufacturing Co) Headlines
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
TSM has been successfully added to your 