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.
Rivian Automotive's Sloan Ratio for the quarter that ended in Dec. 2024 was -6.61%.
As of Dec. 2024, Rivian Automotive has a Sloan Ratio of -6.61%, indicating the company is in the safe zone and there is no funny business with accruals.
Rivian Automotive Sloan Ratio % Historical Data
The historical data trend for Rivian Automotive'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 Rivian Automotive's Sloan Ratio %
For the Auto Manufacturers subindustry, Rivian Automotive'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.
Rivian Automotive's Sloan Ratio % Distribution in the Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Rivian Automotive's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Rivian Automotive'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.
Rivian Automotive's Sloan Ratio for the fiscal year that ended in Dec. 2024 is calculated as
Rivian Automotive's Net Income for the trailing twelve months (TTM) ended in Dec. 2024 was -1330.32 (Mar. 2024 ) + -1353.553 (Jun. 2024 ) + -991.1 (Sep. 2024 ) + -709.565 (Dec. 2024 ) = €-4,385 Mil.
Rivian Automotive's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2024 was -1167.48 (Mar. 2024 ) + -700.466 (Jun. 2024 ) + -789.276 (Sep. 2024 ) + 1129.765 (Dec. 2024 ) = €-1,527 Mil.
Rivian Automotive's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2024 was -557.52 (Mar. 2024 ) + -454.281 (Jun. 2024 ) + 451.401 (Sep. 2024 ) + -1323.63 (Dec. 2024 ) = €-1,884 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.
Rivian Automotive (FRA:99U) 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, Rivian Automotive has a Sloan Ratio of -6.61%, indicating the company is in the safe zone and there is no funny business with accruals.
Rivian Automotive Sloan Ratio % Related Terms
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Rivian Automotive Inc is an automotive manufacturer that develops and builds electric vehicles ("EVs") as well as software and services. It launches its consumer vehicle business with the R1 platform consisting of two vehicles: the R1T, and the R1S. The company has two reportable segments: Automotive, which derives the majority of revenue, and Software and Services segment. The Automotive reportable segment derives its revenues and cost of revenues from the production and sale of new EVs and the sale of regulatory credits generated by the production and sale of EVs. The Software and services reportable segment derives its revenues and cost of revenues primarily from remarketing, vehicle repair and maintenance services, and vehicle electrical architecture and software development services.
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