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.
nVent Electric's Sloan Ratio for the quarter that ended in Dec. 2023 was 19.54%.
As of Dec. 2023, nVent Electric has a Sloan Ratio of 19.54%, indicating there is a warning stage of accrual build up.
nVent Electric Sloan Ratio % Historical Data
The historical data trend for nVent Electric'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 nVent Electric's Sloan Ratio %
For the Electrical Equipment & Parts subindustry, nVent Electric'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.
nVent Electric's Sloan Ratio % Distribution in the Industrial Products Industry
For the Industrial Products industry and Industrials sector, nVent Electric's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where nVent Electric's Sloan Ratio % falls into.
nVent Electric 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.
nVent Electric's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
nVent Electric's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 93.8 (Mar. 2023 ) + 112.9 (Jun. 2023 ) + 105.5 (Sep. 2023 ) + 254.9 (Dec. 2023 ) = $567 Mil.
nVent Electric's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 69.4 (Mar. 2023 ) + 77.2 (Jun. 2023 ) + 145 (Sep. 2023 ) + 236.5 (Dec. 2023 ) = $528 Mil.
nVent Electric's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -16.9 (Mar. 2023 ) + -1103.9 (Jun. 2023 ) + -23.3 (Sep. 2023 ) + -20.6 (Dec. 2023 ) = $-1,165 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.
nVent Electric (NYSE:NVT) 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, nVent Electric has a Sloan Ratio of 19.54%, indicating there is a warning stage of accrual build up.
nVent Electric Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of nVent Electric's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
nVent Electric (nVent Electric) Business Description
nVent Electric PLC is a provider of electrical connection and protection solutions. The company segments include Enclosures, Thermal Management, and Electrical and Fastening Solutions. It generates maximum revenue from the Enclosures segment. The Enclosures segment provides inventive solutions that protect, connect and manage heat in critical electronics, communication, control, and power equipment. Geographically, it derives a majority of revenue from the U.S. and Canada. The company serves the Commercial and Residential, Energy, Industrial Solutions, and Infrastructure industries. Its products include Cabinets and Electronic Packaging, Electrical Fasteners, Hangers and Support, Concrete Reinforcing Steel Connections, Data Center and Networking Systems and others.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
NVT has been successfully added to your 