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.
* 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 Electrameccanica Vehicles's Sloan Ratio %
For the Auto Manufacturers subindustry, Electrameccanica Vehicles'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.
Electrameccanica Vehicles's Sloan Ratio % Distribution in the Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Electrameccanica Vehicles's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Electrameccanica Vehicles's Sloan Ratio % falls into.
Electrameccanica Vehicles 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.
Electrameccanica Vehicles's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Electrameccanica Vehicles's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was -12.312 (Mar. 2023 ) + -12.868 (Jun. 2023 ) + -18.797 (Sep. 2023 ) + -13.606 (Dec. 2023 ) = $-57.58 Mil.
Electrameccanica Vehicles's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was -21.199 (Mar. 2023 ) + -21.802 (Jun. 2023 ) + -10.528 (Sep. 2023 ) + -8.141 (Dec. 2023 ) = $-61.67 Mil.
Electrameccanica Vehicles's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -0.671 (Mar. 2023 ) + 0.057 (Jun. 2023 ) + -6.023 (Sep. 2023 ) + 0.189 (Dec. 2023 ) = $-6.45 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.
Electrameccanica Vehicles (NAS:SOLO) 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. 2023, Electrameccanica Vehicles has a Sloan Ratio of 11.19%, indicating there is a warning stage of accrual build up.
Electrameccanica Vehicles Sloan Ratio % Related Terms
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Electrameccanica Vehicles (Electrameccanica Vehicles) Business Description
Electrameccanica Vehicles Corp Ltd is a development-stage electric vehicle or EV, designer and manufacturer company. The company's product line targets urban commuters, commercial fleets/deliveries and shared mobility seeking to commute in an efficient, cost-effective and environmentally friendly manner. The company's first flagship EV is the SOLO, a single-seat vehicle, of which it has built 64 prototype vehicles in-house and 60 pre-production vehicles with its manufacturing partner, Zongshen. The company's reportable business segments include Electric Vehicles which is the development and manufacture of electric vehicles for mass markets, and Custom built vehicles which is the development and manufacture of high-end custom-built vehicles.
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