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.
Sigma Healthcare's Sloan Ratio for the quarter that ended in Jan. 2024 was -3.12%.
As of Jan. 2024, Sigma Healthcare has a Sloan Ratio of -3.12%, indicating the company is in the safe zone and there is no funny business with accruals.
Sigma Healthcare Sloan Ratio % Historical Data
The historical data trend for Sigma Healthcare'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 Sigma Healthcare's Sloan Ratio %
For the Medical Distribution subindustry, Sigma 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.
Sigma Healthcare's Sloan Ratio % Distribution in the Medical Distribution Industry
For the Medical Distribution industry and Healthcare sector, Sigma Healthcare's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Sigma Healthcare's Sloan Ratio % falls into.
Sigma 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.
Sigma Healthcare's Sloan Ratio for the fiscal year that ended in Jan. 2024 is calculated as
For company reported semi-annually, GuruFocus uses latest two semi-annual data as the TTM data.
Sigma Healthcare's Net Income for the trailing twelve months (TTM) ended in Jan. 2024 was 7.572 (Jul. 2023 ) + -4.459 (Jan. 2024 ) = $3 Mil.
Sigma Healthcare's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jan. 2024 was -1.139 (Jul. 2023 ) + 28.967 (Jan. 2024 ) = $28 Mil.
Sigma Healthcare's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jan. 2024 was -0.399 (Jul. 2023 ) + 4.198 (Jan. 2024 ) = $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.
Sigma Healthcare (OTCPK:SIGGF) 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 Jan. 2024, Sigma Healthcare has a Sloan Ratio of -3.12%, indicating the company is in the safe zone and there is no funny business with accruals.
Sigma Healthcare Sloan Ratio % Related Terms
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Sigma Healthcare (Sigma Healthcare) Business Description
Sigma Healthcare is an Australian pharmaceutical distributor, wholesaler and pharmacy franchisor. The revenue growth prospects and returns of pharmaceutical distribution are subdued due to ongoing Pharmaceutical Benefits Scheme, or PBS, price reform, and regulated wholesale gross margins being capped at 7% for community pharmacy. As a result, Sigma and its competitors are seeking to expand into unregulated revenue streams. In addition, pharmacy ownership is restricted to pharmacists, thereby excluding direct corporate ownership and requiring exposure via a franchise business model.
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