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.
As of Dec. 2023, Affiliated Managers Group has a Sloan Ratio of -5.02%, indicating the company is in the safe zone and there is no funny business with accruals.
Affiliated Managers Group Sloan Ratio % Historical Data
* 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 Affiliated Managers Group's Sloan Ratio %
For the Asset Management subindustry, Affiliated Managers Group'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.
Affiliated Managers Group's Sloan Ratio % Distribution in the Asset Management Industry
For the Asset Management industry and Financial Services sector, Affiliated Managers Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Affiliated Managers Group's Sloan Ratio % falls into.
Affiliated Managers Group 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.
Affiliated Managers Group's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Affiliated Managers Group's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 146 (Mar. 2023 ) + 125.3 (Jun. 2023 ) + 217 (Sep. 2023 ) + 196.1 (Dec. 2023 ) = $684 Mil.
Affiliated Managers Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 234.8 (Mar. 2023 ) + 90.7 (Jun. 2023 ) + 293.9 (Sep. 2023 ) + 254.9 (Dec. 2023 ) = $874 Mil.
Affiliated Managers Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was 288 (Mar. 2023 ) + 3.1 (Jun. 2023 ) + 186.8 (Sep. 2023 ) + -213.4 (Dec. 2023 ) = $265 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.
Affiliated Managers Group (NYSE:AMG) 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 Dec. 2023, Affiliated Managers Group has a Sloan Ratio of -5.02%, indicating the company is in the safe zone and there is no funny business with accruals.
Affiliated Managers Group Sloan Ratio % Related Terms
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Affiliated Managers Group (Affiliated Managers Group) Business Description
Affiliated Managers Group offers investment strategies to investors through its network of affiliates. The firm typically buys a majority interest in small to midsize boutique asset managers, receiving a fixed percentage of revenue from these firms in return. Affiliates operate independently, with AMG providing strategic, operational, and technology support, as well as global distribution. At the end of September 2023, AMG's affiliate network—which includes firms like AQR Capital Management, and Pantheon in alternative assets and other products (which accounted for 36% of AUM), Artemis, Genesis, Harding Loevner, and Tweedy Browne in global and emerging-market equities (27%) and Frontier, River Road, Parnassus, and Yacktman in U.S. equities (21%)—had $635.8 billion in managed assets.
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