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. 2021, Huttig Building Products has a Sloan Ratio of 6.65%, indicating the company is in the safe zone and there is no funny business with accruals.
Huttig Building Products 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 Huttig Building Products's Sloan Ratio %
For the Industrial Distribution subindustry, Huttig Building Products'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.
Huttig Building Products's Sloan Ratio % Distribution in the Industrial Distribution Industry
For the Industrial Distribution industry and Industrials sector, Huttig Building Products's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Huttig Building Products's Sloan Ratio % falls into.
Huttig Building Products 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.
Huttig Building Products's Sloan Ratio for the fiscal year that ended in Dec. 2021 is calculated as
Huttig Building Products's Net Income for the trailing twelve months (TTM) ended in Dec. 2021 was 8.1 (Mar. 2021 ) + 14.9 (Jun. 2021 ) + 18.7 (Sep. 2021 ) + 6.8 (Dec. 2021 ) = $48.5 Mil.
Huttig Building Products's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2021 was -16.5 (Mar. 2021 ) + 15.7 (Jun. 2021 ) + 22 (Sep. 2021 ) + 6.3 (Dec. 2021 ) = $27.5 Mil.
Huttig Building Products's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2021 was -0.2 (Mar. 2021 ) + -0.3 (Jun. 2021 ) + 0.8 (Sep. 2021 ) + 0.1 (Dec. 2021 ) = $0.4 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.
Huttig Building Products (NAS:HBP) 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. 2021, Huttig Building Products has a Sloan Ratio of 6.65%, indicating the company is in the safe zone and there is no funny business with accruals.
Huttig Building Products Sloan Ratio % Related Terms
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Huttig Building Products (Huttig Building Products) Business Description
Huttig Building Products Inc is a distributor of building materials used principally in new residential construction and in home improvement, remodeling and repair work. The company distributes its products through 25 distribution centers serving 41 states and sell primarily to building materials dealers, national buying groups, home centers and industrial users, including makers of manufactured homes. The company's products fall into three categories namely, millwork, which includes doors, windows, moulding, stair parts and columns, general building products, which includes connectors, fasteners, composite decking, housewrap, roofing products and insulation, and wood products, which includes engineered wood products, such as floor systems, as well as wood panels and lumber.
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