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.
Monsanto Co's Sloan Ratio for the quarter that ended in Feb. 2018 was 0.85%.
As of Feb. 2018, Monsanto Co has a Sloan Ratio of 0.85%, indicating the company is in the safe zone and there is no funny business with accruals.
Monsanto Co Sloan Ratio % Historical Data
The historical data trend for Monsanto Co'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 Monsanto Co's Sloan Ratio %
For the Agricultural Inputs subindustry, Monsanto Co'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.
Monsanto Co's Sloan Ratio % Distribution in the Agriculture Industry
For the Agriculture industry and Basic Materials sector, Monsanto Co's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Monsanto Co's Sloan Ratio % falls into.
Monsanto Co 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.
Monsanto Co's Sloan Ratio for the fiscal year that ended in Aug. 2017 is calculated as
Monsanto Co's Net Income for the trailing twelve months (TTM) ended in Feb. 2018 was 831.788 (May. 2017 ) + 19.306 (Aug. 2017 ) + 167.563 (Nov. 2017 ) + 1364.895 (Feb. 2018 ) = CHF2,384 Mil.
Monsanto Co's Cash Flow from Operations for the trailing twelve months (TTM) ended in Feb. 2018 was -835.735 (May. 2017 ) + 2448.001 (Aug. 2017 ) + 1281.018 (Nov. 2017 ) + 316.199 (Feb. 2018 ) = CHF3,209 Mil.
Monsanto Co's Cash Flow from Investing for the trailing twelve months (TTM) ended in Feb. 2018 was -309.824 (May. 2017 ) + -342.681 (Aug. 2017 ) + -208.215 (Nov. 2017 ) + -145.938 (Feb. 2018 ) = CHF-1,007 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.
Monsanto Co (XSWX:MOO) 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 Feb. 2018, Monsanto Co has a Sloan Ratio of 0.85%, indicating the company is in the safe zone and there is no funny business with accruals.
Monsanto Co Sloan Ratio % Related Terms
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Originally a chemical company, Monsanto has morphed into an agricultural giant, focusing on seeds and crop-protection products. In a major breakthrough, Monsanto introduced the first genetically modified crop seeds in 1996 and has remained the industry leader through new product development and licensing agreements. Monsanto continues to focus on bringing new biotechnology traits to market to improve farmer yields and productivity.
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