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.
Revolve Group's Sloan Ratio for the quarter that ended in Dec. 2024 was 4.80%.
As of Dec. 2024, Revolve Group has a Sloan Ratio of 4.80%, indicating the company is in the safe zone and there is no funny business with accruals.
Revolve Group Sloan Ratio % Historical Data
The historical data trend for Revolve Group'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 Revolve Group's Sloan Ratio %
For the Internet Retail subindustry, Revolve 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.
Revolve Group's Sloan Ratio % Distribution in the Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, Revolve Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Revolve Group'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.
Revolve Group's Sloan Ratio for the fiscal year that ended in Dec. 2024 is calculated as
Revolve Group's Net Income for the trailing twelve months (TTM) ended in Dec. 2024 was 10.873 (Mar. 2024 ) + 15.377 (Jun. 2024 ) + 10.971 (Sep. 2024 ) + 12.336 (Dec. 2024 ) = $50 Mil.
Revolve Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2024 was 38.391 (Mar. 2024 ) + -24.669 (Jun. 2024 ) + 9.052 (Sep. 2024 ) + 3.918 (Dec. 2024 ) = $27 Mil.
Revolve Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2024 was -1.735 (Mar. 2024 ) + -2.411 (Jun. 2024 ) + -2.881 (Sep. 2024 ) + -2.087 (Dec. 2024 ) = $-9 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.
Revolve Group (NYSE:RVLV) 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, Revolve Group has a Sloan Ratio of 4.80%, indicating the company is in the safe zone and there is no funny business with accruals.
Revolve Group Sloan Ratio % Related Terms
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The Revolve Group is an emerging e-commerce retailer, selling women's dresses, handbags, shoes, beauty products, and incidentals across its marketplace properties, Revolve and FWRD. The platform is built to suit the "next-generation customer," emphasizing mobile commerce, influencer marketing, and occupying an aspirational but attainable luxury niche. With $1.1 billion in 2024 net sales, the firm sits just outside the top 30 apparel retailers (by sales) in the US, but has consistently generated robust top-line growth as the industry continues to favor digital channels. Revolve generates approximately 18% of sales from private-label offerings, while focusing on building an inventory of unique products from emerging fashion brands with less than $10 million in annual sales.
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