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, Bank of New York Mellon has a Sloan Ratio of 0.78%, indicating the company is in the safe zone and there is no funny business with accruals.
Bank of New York Mellon 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 Bank of New York Mellon's Sloan Ratio %
For the Asset Management subindustry, Bank of New York Mellon'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.
Bank of New York Mellon's Sloan Ratio % Distribution in the Asset Management Industry
For the Asset Management industry and Financial Services sector, Bank of New York Mellon's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Bank of New York Mellon's Sloan Ratio % falls into.
Bank of New York Mellon 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.
Bank of New York Mellon's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Bank of New York Mellon's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 976 (Mar. 2023 ) + 1067 (Jun. 2023 ) + 1038 (Sep. 2023 ) + 205 (Dec. 2023 ) = $3,286 Mil.
Bank of New York Mellon's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 1792 (Mar. 2023 ) + 1148 (Jun. 2023 ) + 5040 (Sep. 2023 ) + -2068 (Dec. 2023 ) = $5,912 Mil.
Bank of New York Mellon's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -17752 (Mar. 2023 ) + -7343 (Jun. 2023 ) + 20631 (Sep. 2023 ) + -1346 (Dec. 2023 ) = $-5,810 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.
Bank of New York Mellon (NYSE:BK) 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, Bank of New York Mellon has a Sloan Ratio of 0.78%, indicating the company is in the safe zone and there is no funny business with accruals.
Bank of New York Mellon Sloan Ratio % Related Terms
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Bank of New York Mellon (Bank of New York Mellon) Business Description
BNY Mellon is a global investment company involved in managing and servicing financial assets throughout the investment lifecycle. The bank provides financial services for institutions, corporations, and individual investors and delivers investment management and investment services in 35 countries and more than 100 markets. BNY Mellon is the largest global custody bank in the world, with about $44.3 trillion in under custody and administration (as of Dec. 31, 2022), and can act as a single point of contact for clients looking to create, trade, hold, manage, service, distribute, or restructure investments. BNY Mellon's asset-management division manages about $1.8 trillion in assets.
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