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.
Zalando SE's Sloan Ratio for the quarter that ended in Sep. 2024 was -7.35%.
As of Sep. 2024, Zalando SE has a Sloan Ratio of -7.35%, indicating the company is in the safe zone and there is no funny business with accruals.
Zalando SE Sloan Ratio % Historical Data
The historical data trend for Zalando SE'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 Zalando SE's Sloan Ratio %
For the Internet Retail subindustry, Zalando SE'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.
Zalando SE's Sloan Ratio % Distribution in the Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, Zalando SE's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Zalando SE's Sloan Ratio % falls into.
Zalando SE 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.
Zalando SE's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Zalando SE's Net Income for the trailing twelve months (TTM) ended in Sep. 2024 was 79.607 (Dec. 2023 ) + -9.674 (Mar. 2024 ) + 103.014 (Jun. 2024 ) + 49.168 (Sep. 2024 ) = $222 Mil.
Zalando SE's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2024 was 900.981 (Dec. 2023 ) + -110.87 (Mar. 2024 ) + 518.515 (Jun. 2024 ) + -101.998 (Sep. 2024 ) = $1,207 Mil.
Zalando SE's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2024 was -180.916 (Dec. 2023 ) + -89.674 (Mar. 2024 ) + -13.563 (Jun. 2024 ) + -44.506 (Sep. 2024 ) = $-329 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.
Zalando SE (OTCPK:ZLNDY) 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, Zalando SE has a Sloan Ratio of -7.35%, indicating the company is in the safe zone and there is no funny business with accruals.
Zalando SE Sloan Ratio % Related Terms
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Zalando, founded in 2008, is Europe's biggest pure-play online fashion platform. Zalando is present in 25 European countries and its major market is the DACH region, comprising Germany, Austria, and Switzerland, which accounts for around 44% of fashion stores' revenue. The company commands around 12% market share in European online apparel sales. It has 12 fulfilment centers and offers over 7,000 brands on its platform. In 2023, Zalando had almost 50 million active users (more than 10% of the population in countries where the firm has a presence).
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