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.
Keurig Dr Pepper's Sloan Ratio for the quarter that ended in Mar. 2024 was 3.25%.
As of Mar. 2024, Keurig Dr Pepper has a Sloan Ratio of 3.25%, indicating the company is in the safe zone and there is no funny business with accruals.
Keurig Dr Pepper Sloan Ratio % Historical Data
The historical data trend for Keurig Dr Pepper'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 Keurig Dr Pepper's Sloan Ratio %
For the Beverages - Non-Alcoholic subindustry, Keurig Dr Pepper'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.
Keurig Dr Pepper's Sloan Ratio % Distribution in the Beverages - Non-Alcoholic Industry
For the Beverages - Non-Alcoholic industry and Consumer Defensive sector, Keurig Dr Pepper's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Keurig Dr Pepper's Sloan Ratio % falls into.
Keurig Dr Pepper 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.
Keurig Dr Pepper's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Keurig Dr Pepper's Net Income for the trailing twelve months (TTM) ended in Mar. 2024 was 503 (Jun. 2023 ) + 518 (Sep. 2023 ) + 693 (Dec. 2023 ) + 454 (Mar. 2024 ) = $2,168 Mil.
Keurig Dr Pepper's Cash Flow from Operations for the trailing twelve months (TTM) ended in Mar. 2024 was 381 (Jun. 2023 ) + 580 (Sep. 2023 ) + 297 (Dec. 2023 ) + 85 (Mar. 2024 ) = $1,343 Mil.
Keurig Dr Pepper's Cash Flow from Investing for the trailing twelve months (TTM) ended in Mar. 2024 was -98 (Jun. 2023 ) + -420 (Sep. 2023 ) + -161 (Dec. 2023 ) + -193 (Mar. 2024 ) = $-872 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.
Keurig Dr Pepper (NAS:KDP) 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 Mar. 2024, Keurig Dr Pepper has a Sloan Ratio of 3.25%, indicating the company is in the safe zone and there is no funny business with accruals.
Keurig Dr Pepper Sloan Ratio % Related Terms
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Keurig Dr Pepper (Keurig Dr Pepper) Business Description
Keurig Dr Pepper was established in 2018 following a merger between Keurig Green Mountain Coffee and Dr Pepper Snapple. The company manufactures and distributes coffee systems (including coffee brewers and single-serve coffee pods) under the Keurig and Green Mountain brands, as well as ready-to-drink beverages including flavored (non-cola) sparkling soft drinks under well-known brands such as Dr Pepper, Snapple, and Canada Dry. The company controls production and route to market for its own brands through in-house manufacturing plants and distribution infrastructure and leverages these facilities to manufacture and distribute for third-party coffee and beverage brands via licensing and partnership agreements. U.S. and Canada make up 95% of revenues, with the rest from Mexico.
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