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.
City National's Sloan Ratio for the quarter that ended in Jun. 2015 was 8.61%.
As of Jun. 2015, City National has a Sloan Ratio of 8.61%, indicating the company is in the safe zone and there is no funny business with accruals.
City National Sloan Ratio % Historical Data
The historical data trend for City National'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 City National's Sloan Ratio %
For the Banks - Regional subindustry, City National'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.
City National's Sloan Ratio % Distribution in the Banks Industry
For the Banks industry and Financial Services sector, City National's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where City National's Sloan Ratio % falls into.
City National 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.
City National's Sloan Ratio for the fiscal year that ended in Dec. 2014 is calculated as
City National's Net Income for the trailing twelve months (TTM) ended in Jun. 2015 was 68.651 (Sep. 2014 ) + 65.956 (Dec. 2014 ) + 61.566 (Mar. 2015 ) + 68.499 (Jun. 2015 ) = $265 Mil.
City National's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2015 was 18.432 (Sep. 2014 ) + 40.755 (Dec. 2014 ) + 65.827 (Mar. 2015 ) + 141.793 (Jun. 2015 ) = $267 Mil.
City National's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2015 was -1165.218 (Sep. 2014 ) + -1174.584 (Dec. 2014 ) + 160.955 (Mar. 2015 ) + -729.678 (Jun. 2015 ) = $-2,909 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.
City National (NYSE:CYN) 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 Jun. 2015, City National has a Sloan Ratio of 8.61%, indicating the company is in the safe zone and there is no funny business with accruals.
City National Sloan Ratio % Related Terms
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City National (City National) Business Description
City National Corp is a Delaware corporation organized in 1968. It is a bank holding company and a financial holding company. It provides banking, investment and trust services to its clients through its wholly-owned banking subsidiary, City National Bank. The Bank operates through 77 offices, including 16 full-service regional centers, in Southern California, the San Francisco Bay area, Nevada, New York City, Nashville, Tennessee and Atlanta, Georgia. The Company provides financial solutions to affluent individuals, entrepreneurs, professionals, their businesses and their families. The Company's segments include, Commercial and Private Banking, & Wealth Management. The Commercial and Private Banking segment provides banking products and services, including commercial and mortgage lending, lines of credit, equipment lease financing, deposits, cash management services, international trade finance and letters of credit. All investment advisory affiliates and the Bank's wealth management services are included in the Wealth Management segment. The Company's principal client base consists of small to mid-sized businesses, entrepreneurs, professionals, and affluent individuals. The Company serves its clients through relationship banking. The Company offers lending, deposit, cash management, international banking, equipment financing, and other products and services. The Bank's wealth management division make available the following investment advisory and wealth management resources to the Company's clients: investment management and advisory services and brokerage services, including portfolio management, securities trading and asset management; personal and business trust and investment services, including employee benefit trust services, 401(k) and defined benefit plans; and estate and financial planning and custodial services. The Company also advises and makes available mutual funds under the name of City National Rochdale Funds. The Bank's wealth management division and the Company's asset management subsidiaries provide both proprietary and nonproprietary products to offer asset classes and investment styles, including fixed-income instruments, mutual funds, domestic and international equities and alternative investments, such as hedge funds. Investment services are provided to institutional as well as individual clients. The Company faces competitive credit and pricing pressure as it competes with other banks and financial organizations. It is subject to extensive regulation under both federal and state law.
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