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.
When sloan ratio (42.29)% higher than 25% or lower than -25%, earnings are more likely to be made up of accruals.
As of Sep. 2024, American Coastal Insurance has a Sloan Ratio of -0.75%, indicating the company is in the safe zone and there is no funny business with accruals.
American Coastal Insurance Sloan Ratio % Historical Data
* 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 American Coastal Insurance's Sloan Ratio %
For the Insurance - Property & Casualty subindustry, American Coastal Insurance'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.
American Coastal Insurance's Sloan Ratio % Distribution in the Insurance Industry
For the Insurance industry and Financial Services sector, American Coastal Insurance's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where American Coastal Insurance's Sloan Ratio % falls into.
American Coastal Insurance 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.
American Coastal Insurance's Net Income for the trailing twelve months (TTM) ended in Sep. 2024 was 14.284 (Dec. 2023 ) + 23.599 (Mar. 2024 ) + 19.054 (Jun. 2024 ) + 28.119 (Sep. 2024 ) = $85.1 Mil.
American Coastal Insurance's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2024 was 48.886 (Dec. 2023 ) + 124.484 (Mar. 2024 ) + 126.402 (Jun. 2024 ) + -8.979 (Sep. 2024 ) = $290.8 Mil.
American Coastal Insurance's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2024 was -34.272 (Dec. 2023 ) + -2.005 (Mar. 2024 ) + -150.809 (Jun. 2024 ) + -10.09 (Sep. 2024 ) = $-197.2 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.
American Coastal Insurance (NAS:ACIC) 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 Sep. 2024, American Coastal Insurance has a Sloan Ratio of -0.75%, indicating the company is in the safe zone and there is no funny business with accruals.
American Coastal Insurance Sloan Ratio % Related Terms
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American Coastal Insurance Corp is a holding company that underwrites commercial residential property and casualty insurance policies in the United States through its wholly-owned insurance subsidiary. The company has two segments namely: Commercial Lines Business and Personal Lines Business. It derives maximum revenue from Commercial Lines Business Segment.
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