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.
Taiwan Tea's Sloan Ratio for the quarter that ended in Sep. 2024 was -1.76%.
As of Sep. 2024, Taiwan Tea has a Sloan Ratio of -1.76%, indicating the company is in the safe zone and there is no funny business with accruals.
Taiwan Tea Sloan Ratio % Historical Data
The historical data trend for Taiwan Tea'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 Taiwan Tea's Sloan Ratio %
For the Farm Products subindustry, Taiwan Tea'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.
Taiwan Tea's Sloan Ratio % Distribution in the Consumer Packaged Goods Industry
For the Consumer Packaged Goods industry and Consumer Defensive sector, Taiwan Tea's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Taiwan Tea's Sloan Ratio % falls into.
Taiwan Tea 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.
Taiwan Tea's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Taiwan Tea's Net Income for the trailing twelve months (TTM) ended in Sep. 2024 was -131.247 (Dec. 2023 ) + -43.96 (Mar. 2024 ) + -52.252 (Jun. 2024 ) + -38.903 (Sep. 2024 ) = NT$-266.4 Mil.
Taiwan Tea's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2024 was -11.827 (Dec. 2023 ) + -24.463 (Mar. 2024 ) + 7.892 (Jun. 2024 ) + 128.212 (Sep. 2024 ) = NT$99.8 Mil.
Taiwan Tea's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2024 was 17.168 (Dec. 2023 ) + -26.057 (Mar. 2024 ) + -1.657 (Jun. 2024 ) + 21.596 (Sep. 2024 ) = NT$11.1 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.
Taiwan Tea (TPE:2913) 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. 2024, Taiwan Tea has a Sloan Ratio of -1.76%, indicating the company is in the safe zone and there is no funny business with accruals.
Taiwan Tea Sloan Ratio % Related Terms
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Taiwan Tea Corp plants, cultivates and distributes tea and other tea ingredients. It plants tea trees and cultivates tea plantations. The tea leaves are roasted and processed into tea ingredients, packaged, and distributed to Asia and Australia. The company has a diverse range of customers, including large tea factories and channels such as bubble teashops, breakfast shops, and chain restaurants. Additionally, Taiwan Tea has an engineering division to sell building materials and take on interior fitting projects. It utilizes contracts to help provide stock and customized solutions to customers. The company's operating segments are Trade and department stores; and Assets.
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