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.
Nuance Communications's Sloan Ratio for the quarter that ended in Dec. 2021 was -8.76%.
As of Dec. 2021, Nuance Communications has a Sloan Ratio of -8.76%, indicating the company is in the safe zone and there is no funny business with accruals.
Nuance Communications Sloan Ratio % Historical Data
The historical data trend for Nuance Communications'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 Nuance Communications's Sloan Ratio %
For the Software - Application subindustry, Nuance Communications'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.
Nuance Communications's Sloan Ratio % Distribution in the Software Industry
For the Software industry and Technology sector, Nuance Communications's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Nuance Communications's Sloan Ratio % falls into.
Nuance Communications 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.
Nuance Communications's Sloan Ratio for the fiscal year that ended in Sep. 2021 is calculated as
Nuance Communications's Net Income for the trailing twelve months (TTM) ended in Dec. 2021 was -3.634 (Mar. 2021 ) + -26.267 (Jun. 2021 ) + -11.72 (Sep. 2021 ) + -57.559 (Dec. 2021 ) = $-99 Mil.
Nuance Communications's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2021 was 88.432 (Mar. 2021 ) + 47.841 (Jun. 2021 ) + 50.178 (Sep. 2021 ) + 13.85 (Dec. 2021 ) = $200 Mil.
Nuance Communications's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2021 was -46.011 (Mar. 2021 ) + -5.56 (Jun. 2021 ) + 31.121 (Sep. 2021 ) + 4.602 (Dec. 2021 ) = $-16 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.
Nuance Communications (NAS:NUAN) 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. 2021, Nuance Communications has a Sloan Ratio of -8.76%, indicating the company is in the safe zone and there is no funny business with accruals.
Nuance Communications Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of Nuance Communications's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
Nuance Communications (Nuance Communications) Business Description
Nuance Communications Inc is the pioneer in conversational AI innovations that bring intelligence to everyday work and life. The company delivers solutions that understand, analyze, and respond to people amplifying human intelligence to increase productivity and security. Its operating segment includes Healthcare; Enterprise; and Other. The company generates maximum revenue from the Healthcare segment. Its Healthcare segment is primarily engaged in providing clinical speech and clinical language understanding solutions that improve the clinical documentation process, from capturing the complete patient record to improving clinical documentation and quality measures for reimbursement. Geographically, it derives a majority of revenue from the United States.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
NUAN has been successfully added to your 