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.
IGC Pharma's Sloan Ratio for the quarter that ended in Dec. 2024 was -39.60%.
Warning Sign:
When sloan ratio (-75.58)% higher than 25% or lower than -25%, earnings are more likely to be made up of accruals.
As of Dec. 2024, IGC Pharma has a Sloan Ratio of -39.60%, indicating earnings are more likely to be made up of accruals.
IGC Pharma Sloan Ratio % Historical Data
The historical data trend for IGC Pharma'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 IGC Pharma's Sloan Ratio %
For the Biotechnology subindustry, IGC Pharma'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.
IGC Pharma's Sloan Ratio % Distribution in the Biotechnology Industry
For the Biotechnology industry and Healthcare sector, IGC Pharma's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where IGC Pharma'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.
IGC Pharma's Sloan Ratio for the fiscal year that ended in Mar. 2024 is calculated as
IGC Pharma's Net Income for the trailing twelve months (TTM) ended in Dec. 2024 was -2.885 (Mar. 2024 ) + -2.378 (Jun. 2024 ) + -1.717 (Sep. 2024 ) + -1.829 (Dec. 2024 ) = $-8.81 Mil.
IGC Pharma's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2024 was -0.526 (Mar. 2024 ) + -1.752 (Jun. 2024 ) + -0.996 (Sep. 2024 ) + -1.317 (Dec. 2024 ) = $-4.59 Mil.
IGC Pharma's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2024 was -0.323 (Mar. 2024 ) + -0.131 (Jun. 2024 ) + -0.065 (Sep. 2024 ) + -0.104 (Dec. 2024 ) = $-0.62 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.
IGC Pharma (AMEX:IGC) 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, IGC Pharma has a Sloan Ratio of -39.60%, indicating earnings are more likely to be made up of accruals.
IGC Pharma Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of IGC Pharma's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
IGC Pharma Inc develops advanced cannabinoid-based formulations for treating diseases and conditions, including, but not limited to, Alzheimer's disease, period cramps, premenstrual syndrome and chronic pain. The company has two investigational drug assets targeting Alzheimer's disease, IGC-AD1 and TGR-63, which have demonstrated in Alzheimer's cell lines the potential to be effective in suppressing or ameliorating key hallmarks of Alzheimer's disease, such as plaques or tangles. IGC-AD1 is a low-dose tetrahydrocannabinol-based formulation that is in a 146-person Phase 2 clinical trial for agitation in dementia due to Alzheimer's. IGC also markets a wellness brand, Holief, that targets women experiencing premenstrual syndrome and menstrual cramps.
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