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.
Five Below's Sloan Ratio for the quarter that ended in Jan. 2024 was 9.31%.
As of Jan. 2024, Five Below has a Sloan Ratio of 9.31%, indicating the company is in the safe zone and there is no funny business with accruals.
Five Below Sloan Ratio % Historical Data
The historical data trend for Five Below'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 Five Below's Sloan Ratio %
For the Specialty Retail subindustry, Five Below'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.
Five Below's Sloan Ratio % Distribution in the Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, Five Below's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Five Below's Sloan Ratio % falls into.
Five Below 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.
Five Below's Sloan Ratio for the fiscal year that ended in Jan. 2024 is calculated as
Five Below's Net Income for the trailing twelve months (TTM) ended in Jan. 2024 was 34.18 (Apr. 2023 ) + 42.339 (Jul. 2023 ) + 13.821 (Oct. 2023 ) + 185.619 (Jan. 2024 ) = €276 Mil.
Five Below's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jan. 2024 was 77.785 (Apr. 2023 ) + 75.915 (Jul. 2023 ) + -73.279 (Oct. 2023 ) + 374.297 (Jan. 2024 ) = €455 Mil.
Five Below's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jan. 2024 was -60.636 (Apr. 2023 ) + -76.753 (Jul. 2023 ) + -12.96 (Oct. 2023 ) + -359.176 (Jan. 2024 ) = €-510 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.
Five Below (STU:6F1) 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, Five Below has a Sloan Ratio of 9.31%, indicating the company is in the safe zone and there is no funny business with accruals.
Five Below Sloan Ratio % Related Terms
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Five Below is a value-oriented retailer that operated 1,340 stores in the United States as of the end of fiscal 2022. Catering to teen and preteen consumers, its stores feature a wide variety of merchandise, the vast majority of which is priced below $6. The assortment focuses on discretionary items in several categories, particularly leisure (such as sporting goods, toys, and electronics; 48% of fiscal 2022 sales), fashion and home (for example, beauty products and accessories, home goods, and storage solutions; 29% of fiscal 2022 sales), and party and snack (including seasonal goods, candy, and beverages; 23% of fiscal 2022 sales). The chain had stores in 42 states as of the end of fiscal 2022.
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