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.
As of Dec. 2024, Fresh Del Monte Produce has a Sloan Ratio of -1.96%, indicating the company is in the safe zone and there is no funny business with accruals.
Fresh Del Monte Produce 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 Fresh Del Monte Produce's Sloan Ratio %
For the Farm Products subindustry, Fresh Del Monte Produce'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.
Fresh Del Monte Produce's Sloan Ratio % Distribution in the Consumer Packaged Goods Industry
For the Consumer Packaged Goods industry and Consumer Defensive sector, Fresh Del Monte Produce's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Fresh Del Monte Produce's Sloan Ratio % falls into.
Fresh Del Monte Produce 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.
Fresh Del Monte Produce's Sloan Ratio for the fiscal year that ended in Dec. 2024 is calculated as
Fresh Del Monte Produce's Net Income for the trailing twelve months (TTM) ended in Dec. 2024 was 26.1 (Mar. 2024 ) + 53.6 (Jun. 2024 ) + 42.1 (Sep. 2024 ) + 20.4 (Dec. 2024 ) = $142 Mil.
Fresh Del Monte Produce's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2024 was 18.7 (Mar. 2024 ) + 125 (Jun. 2024 ) + 43.5 (Sep. 2024 ) + -4.7 (Dec. 2024 ) = $183 Mil.
Fresh Del Monte Produce's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2024 was 3.9 (Mar. 2024 ) + -2.3 (Jun. 2024 ) + -0.6 (Sep. 2024 ) + 19.4 (Dec. 2024 ) = $20 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.
Fresh Del Monte Produce (NYSE:FDP) 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. 2024, Fresh Del Monte Produce has a Sloan Ratio of -1.96%, indicating the company is in the safe zone and there is no funny business with accruals.
Fresh Del Monte Produce Sloan Ratio % Related Terms
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Fresh Del Monte Produce Inc is an integrated producer, marketer & distributor of fresh-cut fruit & vegetables. It operates in three segments, Fresh and value-added products segment, which includes pineapples, fresh-cut fruit, fresh-cut vegetables, melons, vegetables, non-tropical fruit, other fruit and vegetables, avocados, and prepared foods, Banana segment & Other products and services segment, including the third-party freight & logistic services business & the Jordanian poultry and meats business. The majority is from the Fresh and value-added products segment. Geographically, it operates in North America, Europe, Asia, the Middle East, and Other, out of which the highest is from North America.
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