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.
Medicure's Sloan Ratio for the quarter that ended in Sep. 2024 was -5.65%.
As of Sep. 2024, Medicure has a Sloan Ratio of -5.65%, indicating the company is in the safe zone and there is no funny business with accruals.
Medicure Sloan Ratio % Historical Data
The historical data trend for Medicure'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 Medicure's Sloan Ratio %
For the Drug Manufacturers - Specialty & Generic subindustry, Medicure'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.
Medicure's Sloan Ratio % Distribution in the Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Medicure's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Medicure's Sloan Ratio % falls into.
Medicure 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.
Medicure's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Medicure's Net Income for the trailing twelve months (TTM) ended in Sep. 2024 was -1.548 (Dec. 2023 ) + 0.051 (Mar. 2024 ) + -1.217 (Jun. 2024 ) + 0.68 (Sep. 2024 ) = C$-2.03 Mil.
Medicure's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2024 was 0.927 (Dec. 2023 ) + -0.132 (Mar. 2024 ) + -0.03 (Jun. 2024 ) + -0.77 (Sep. 2024 ) = C$-0.01 Mil.
Medicure's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2024 was -0.128 (Dec. 2023 ) + -0.087 (Mar. 2024 ) + -0.104 (Jun. 2024 ) + -0.1 (Sep. 2024 ) = C$-0.42 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.
Medicure (TSXV:MPH) 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, Medicure has a Sloan Ratio of -5.65%, indicating the company is in the safe zone and there is no funny business with accruals.
Medicure Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of Medicure's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
Medicure Inc is a biopharmaceutical company. It is involved in the research, clinical development, and commercialization of human therapeutics for the United States hospital market. Further, it also operates a specialty pharmacy in the United States of America. The company's present focus is the sale and marketing of its cardiovascular products, AGGRASTAT, ZYPITAMAG, and developing its e-commerce and mail order pharmaceutical business. The company operates in two segments namely, Marketing and distribution of commercial products and, Retail and mail order pharmacy. The majority of the company's revenue is generated from the marketing and distribution of the commercial products segment.
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