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 Jun. 2024, Nexteer Automotive Group has a Sloan Ratio of -0.71%, indicating the company is in the safe zone and there is no funny business with accruals.
Nexteer Automotive Group 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 Nexteer Automotive Group's Sloan Ratio %
For the Auto Parts subindustry, Nexteer Automotive 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.
Nexteer Automotive Group's Sloan Ratio % Distribution in the Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Nexteer Automotive Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Nexteer Automotive Group's Sloan Ratio % falls into.
Nexteer Automotive 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.
Nexteer Automotive Group's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
For company reported semi-annually, GuruFocus uses latest two semi-annual data as the TTM data.
Nexteer Automotive Group's Net Income for the trailing twelve months (TTM) ended in Jun. 2024 was 2.516 (Dec. 2023 ) + 14.581 (Jun. 2024 ) = €17 Mil.
Nexteer Automotive Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2024 was 158.58 (Dec. 2023 ) + 141.568 (Jun. 2024 ) = €300 Mil.
Nexteer Automotive Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2024 was -117.222 (Dec. 2023 ) + -143.668 (Jun. 2024 ) = €-261 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.
Nexteer Automotive Group (FRA:8NX) 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 Jun. 2024, Nexteer Automotive Group has a Sloan Ratio of -0.71%, indicating the company is in the safe zone and there is no funny business with accruals.
Nexteer Automotive Group Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of Nexteer Automotive Group's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
Nexteer Automotive Group Ltd offers advanced steering and driveline systems. The company's customers are automakers like BMW, Fiat Chrysler, Ford, GM, and Toyota, as well as automakers in India, South America, and China. The business units are electric power steering, hydraulic power steering, steering columns, driveline, and half shafts. The electric power steering includes columns, an intermediate shaft, and steering gear, EPS motors, sensors, controllers, and assist mechanisms. The Group classifies its businesses into three reportable segments: North America, Asia Pacific, and Europe, Middle East, Africa and South America (EMEASA). All of the Group's operating segments typically offer the same steering and driveline products, the majority are derived from North America.
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