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.
Martin Marietta Materials's Sloan Ratio for the quarter that ended in Dec. 2023 was -5.41%.
As of Dec. 2023, Martin Marietta Materials has a Sloan Ratio of -5.41%, indicating the company is in the safe zone and there is no funny business with accruals.
Martin Marietta Materials 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 Martin Marietta Materials's Sloan Ratio %
For the Building Materials subindustry, Martin Marietta Materials'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.
Martin Marietta Materials's Sloan Ratio % Distribution in the Building Materials Industry
For the Building Materials industry and Basic Materials sector, Martin Marietta Materials's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Martin Marietta Materials's Sloan Ratio % falls into.
Martin Marietta Materials 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.
Martin Marietta Materials's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Martin Marietta Materials's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 121.4 (Mar. 2023 ) + 348.3 (Jun. 2023 ) + 416.7 (Sep. 2023 ) + 282.5 (Dec. 2023 ) = $1,169 Mil.
Martin Marietta Materials's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 160.5 (Mar. 2023 ) + 358 (Jun. 2023 ) + 454 (Sep. 2023 ) + 555.9 (Dec. 2023 ) = $1,528 Mil.
Martin Marietta Materials's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -152.4 (Mar. 2023 ) + -44.9 (Jun. 2023 ) + 523.6 (Sep. 2023 ) + 132.4 (Dec. 2023 ) = $459 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.
Martin Marietta Materials (NYSE:MLM) 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, Martin Marietta Materials has a Sloan Ratio of -5.41%, indicating the company is in the safe zone and there is no funny business with accruals.
Martin Marietta Materials Sloan Ratio % Related Terms
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Martin Marietta Materials (Martin Marietta Materials) Business Description
Martin Marietta Materials is one of the United States' largest producer of construction aggregates (crushed stone, sand, and gravel). In 2022, Martin Marietta sold 207 million tons of aggregates. Martin Marietta's most important markets include Texas, Colorado, North Carolina, Georgia, and Florida, accounting for most of its sales. The company also produces cement in Texas and uses its aggregates in its asphalt and ready-mixed concrete businesses. Martin's magnesia specialties business produces magnesia-based chemical products and dolomitic lime.
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