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 Sep. 2023, Fisher & Paykel Healthcare has a Sloan Ratio of 9.66%, indicating the company is in the safe zone and there is no funny business with accruals.
Fisher & Paykel Healthcare 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 Fisher & Paykel Healthcare's Sloan Ratio %
For the Medical Instruments & Supplies subindustry, Fisher & Paykel Healthcare'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.
Fisher & Paykel Healthcare's Sloan Ratio % Distribution in the Medical Devices & Instruments Industry
For the Medical Devices & Instruments industry and Healthcare sector, Fisher & Paykel Healthcare's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Fisher & Paykel Healthcare's Sloan Ratio % falls into.
Fisher & Paykel Healthcare 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.
For company reported semi-annually, GuruFocus uses latest two semi-annual data as the TTM data.
Fisher & Paykel Healthcare's Net Income for the trailing twelve months (TTM) ended in Sep. 2023 was 154.4 (Mar. 2023 ) + 107.3 (Sep. 2023 ) = NZ$262 Mil.
Fisher & Paykel Healthcare's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2023 was 236.3 (Mar. 2023 ) + 156.5 (Sep. 2023 ) = NZ$393 Mil.
Fisher & Paykel Healthcare's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2023 was -86.5 (Mar. 2023 ) + -275.5 (Sep. 2023 ) = NZ$-362 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.
Fisher & Paykel Healthcare (NZSE:FPH) 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 Sep. 2023, Fisher & Paykel Healthcare has a Sloan Ratio of 9.66%, indicating the company is in the safe zone and there is no funny business with accruals.
Fisher & Paykel Healthcare Sloan Ratio % Related Terms
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Fisher & Paykel Healthcare (NZSE:FPH) Business Description
Fisher & Paykel Healthcare is one of the three largest respiratory care device companies globally. It is the market leader in hospital use humidifiers, masks and related consumables and the number three player in the at-home treatment of sleep apnoea using respiratory devices. Both the hospital and homecare markets for respiratory devices are growing strongly in the developed markets in which Fisher & Paykel has a presence. The company earns 42% of its revenue in the U.S., 32% in Europe, 18% in Asia-Pacific and the remaining 8% in emerging markets. Fisher conducts its own R&D and has thousands of patents and pending applications. It manufactures in New Zealand and Mexico and has a multichannel distribution model.
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