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.
Ashtead Group's Sloan Ratio for the quarter that ended in Jan. 2024 was 13.15%.
As of Jan. 2024, Ashtead Group has a Sloan Ratio of 13.15%, indicating there is a warning stage of accrual build up.
Ashtead Group Sloan Ratio % Historical Data
The historical data trend for Ashtead 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 Ashtead Group's Sloan Ratio %
For the Rental & Leasing Services subindustry, Ashtead 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.
Ashtead Group's Sloan Ratio % Distribution in the Business Services Industry
For the Business Services industry and Industrials sector, Ashtead Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Ashtead Group's Sloan Ratio % falls into.
Ashtead 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.
Ashtead Group's Sloan Ratio for the fiscal year that ended in Apr. 2023 is calculated as
Ashtead Group's Net Income for the trailing twelve months (TTM) ended in Jan. 2024 was 346.1 (Apr. 2023 ) + 447.4 (Jul. 2023 ) + 494 (Oct. 2023 ) + 332.3 (Jan. 2024 ) = $1,620 Mil.
Ashtead Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jan. 2024 was 351.4 (Apr. 2023 ) + -14.4 (Jul. 2023 ) + -15.2 (Oct. 2023 ) + 40 (Jan. 2024 ) = $362 Mil.
Ashtead Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jan. 2024 was -265.2 (Apr. 2023 ) + -440.5 (Jul. 2023 ) + -565.9 (Oct. 2023 ) + -334.4 (Jan. 2024 ) = $-1,606 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.
Ashtead Group (OTCPK:ASHTY) 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 Jan. 2024, Ashtead Group has a Sloan Ratio of 13.15%, indicating there is a warning stage of accrual build up.
Ashtead Group Sloan Ratio % Related Terms
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Ashtead Group (Ashtead Group) Business Description
Ashtead is an equipment rental business with operations in the U.S., Canada, and United Kingdom, operating under the Sunbelt Rentals brand. Earnings are mostly derived from the U.S. where Sunbelt enjoy a number-two market position with a 13% share in a highly fragmented market consisting of national, regional, and independent competitors. Ashtead rents a range of construction, industrial, and general equipment such as aerial lifts, hand-held tools, and forklifts across its more than 1,550 rental stores worldwide.
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