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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.
Adamas Pharmaceuticals's Sloan Ratio for the quarter that ended in Sep. 2021 was -16.49%.
Warning Sign:
When Sloan Ratio (-51.35)% higher than 25% or lower than -25%, earnings are more likely to be made up of accruals.
As of Sep. 2021, Adamas Pharmaceuticals has a Sloan Ratio of -16.49%, indicating earnings are more likely to be made up of accruals.
The historical data trend for Adamas Pharmaceuticals'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.
Adamas Pharmaceuticals Annual Data | |||||||||||||||||||
Trend | Dec12 | Dec13 | Dec14 | Dec15 | Dec16 | Dec17 | Dec18 | Dec19 | Dec20 | ||||||||||
Sloan Ratio % | Get a 7-Day Free Trial | 10.33 | -25.90 | 18.13 | -69.85 | -51.35 |
Adamas Pharmaceuticals Quarterly Data | ||||||||||||||||||||
Dec16 | Mar17 | Jun17 | Sep17 | Dec17 | Mar18 | Jun18 | Sep18 | Dec18 | Mar19 | Jun19 | Sep19 | Dec19 | Mar20 | Jun20 | Sep20 | Dec20 | Mar21 | Jun21 | Sep21 | |
Sloan Ratio % | Get a 7-Day Free Trial | -30.36 | -51.35 | -38.15 | -30.23 | -16.49 |
For the Drug Manufacturers - Specialty & Generic subindustry, Adamas Pharmaceuticals'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.
For the Drug Manufacturers industry and Healthcare sector, Adamas Pharmaceuticals's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Adamas Pharmaceuticals's Sloan Ratio % falls into.
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.
Adamas Pharmaceuticals's Sloan Ratio for the fiscal year that ended in Dec. 2020 is calculated as
Sloan Ratio | = | (Net Income (A: Dec. 2020 ) | - | Cash Flow from Operations (A: Dec. 2020 ) |
- | Cash Flow from Investing (A: Dec. 2020 )) | / | Total Assets (A: Dec. 2020 ) | |
= | (-57.403 | - | -50.708 | |
- | 54.94) | / | 120.029 | |
= | -51.35% |
Adamas Pharmaceuticals's Sloan Ratio for the quarter that ended in Sep. 2021 is calculated as
Sloan Ratio | = | (Net Income (TTM) | - | Cash Flow from Operations (TTM)) |
- | Cash Flow from Investing (TTM)) | / | Total Assets (Q: Sep. 2021 ) | |
= | (-62.708 | - | -46.813 | |
- | 7.844) | / | 143.977 | |
= | -16.49% |
Adamas Pharmaceuticals's Net Income for the trailing twelve months (TTM) ended in Sep. 2021 was -18.273 (Dec. 2020 ) + -12.573 (Mar. 2021 ) + -12.344 (Jun. 2021 ) + -19.518 (Sep. 2021 ) = $-62.71 Mil. Adamas Pharmaceuticals's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2021 was -10.327 (Dec. 2020 ) + -21.063 (Mar. 2021 ) + -9.178 (Jun. 2021 ) + -6.245 (Sep. 2021 ) = $-46.81 Mil. Adamas Pharmaceuticals's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2021 was 29.91 (Dec. 2020 ) + 7.79 (Mar. 2021 ) + -26.848 (Jun. 2021 ) + -3.008 (Sep. 2021 ) = $7.84 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.
Adamas Pharmaceuticals (NAS:ADMS) 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.
According to How to Beat the Market with the Sloan Ratio:
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. 2021, Adamas Pharmaceuticals has a Sloan Ratio of -16.49%, indicating earnings are more likely to be made up of accruals.
Thank you for viewing the detailed overview of Adamas Pharmaceuticals's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
Vijay Shreedhar | officer: Chief Commercial Officer | C/O ADAMAS PHARMACEUTICALS, INC. 1900 POWELL STREET, SUITE 1000 EMERYVILLE CA 94608 |
Christopher B Prentiss | officer: Chief Financial Officer | 1900 POWELL STREET SUITE 750 EMERYVILLE CA 94608 |
Anna Richo | director | AMGEN INC., ONE AMGEN CENTER DRIVE, THOUSAND OAKS CA 91320-1799 |
David L Mahoney | director | SYMANTEC CORPORATION, 20330 STEVENS CREEK BLVD., CUPERTINO CA 95014 |
Mardi Dier | director | C/O ACELYRIN, INC., 4149 LIBERTY CANYON RD., AGOURA HILLS CA 91301 |
William W. Ericson | director, 10 percent owner | 777 MARINERS ISLAND BOULEVARD, SUITE 550, SAN MATEO CA 94404 |
John A Macphee | director | C/O ADAMAS PHARMACEUTICALS, INC. 1900 POWELL ST., SUITE 750 EMERYVILLE CA 94608 |
Ivan M Lieberburg | director | 11682 EL CAMINO REAL, SUITE 320, SAN DIEGO CA 92130 |
Michael Bigham | director | 890 WINTER STREET, WALTHAM MA 02451 |
Martha J Demski | director | 7770 REGENTS ROAD SUITE 113-505, SAN DIEGO CA 92122 |
Neil F. Mcfarlane | officer: Chief Executive Officer | C/O RETROPHIN, INC., 12255 EL CAMINO REAL, SUITE 250, SAN DIEGO CA 92130 |
Alfred G Merriweather | officer: Chief Financial Officer | |
Jennifer J Rhodes | officer: CBO, GC & Compliance Officer | C/O ADAMAS PHARMACEUTICALS INC., 1900 POWELL ST., SUITE 750, EMERYVILLE CA 94608 |
Gregory T Went | director, officer: Chief Executive Officer | C/O ADAMAS PHARMACEUTICALS, INC. 2200 POWELL ST, STE 220 EMERYVILLE CA 94608 |
Rajiv Patni | officer: Chief Medical Officer | C/O OCERA THERAPEUTICS, INC., 525 UNIVERSITY AVENUE, SUITE 610, PALO ALTO CA 94301 |
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