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.
Royal Caribbean Group's Sloan Ratio for the quarter that ended in Dec. 2023 was 3.25%.
As of Dec. 2023, Royal Caribbean Group has a Sloan Ratio of 3.25%, indicating the company is in the safe zone and there is no funny business with accruals.
Royal Caribbean Group Sloan Ratio % Historical Data
The historical data trend for Royal Caribbean Group'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 Royal Caribbean Group's Sloan Ratio %
For the Travel Services subindustry, Royal Caribbean Group'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.
Royal Caribbean Group's Sloan Ratio % Distribution in the Travel & Leisure Industry
For the Travel & Leisure industry and Consumer Cyclical sector, Royal Caribbean Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Royal Caribbean Group's Sloan Ratio % falls into.
Royal Caribbean Group 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.
Royal Caribbean Group's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Royal Caribbean Group's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was -47.91 (Mar. 2023 ) + 458.761 (Jun. 2023 ) + 1009.076 (Sep. 2023 ) + 277.073 (Dec. 2023 ) = $1,697 Mil.
Royal Caribbean Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 1309.918 (Mar. 2023 ) + 1391.347 (Jun. 2023 ) + 659.74 (Sep. 2023 ) + 1115.995 (Dec. 2023 ) = $4,477 Mil.
Royal Caribbean Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -234.1 (Mar. 2023 ) + -788.049 (Jun. 2023 ) + -327.063 (Sep. 2023 ) + -2573.788 (Dec. 2023 ) = $-3,923 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.
Royal Caribbean Group (NYSE:RCL) 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, Royal Caribbean Group has a Sloan Ratio of 3.25%, indicating the company is in the safe zone and there is no funny business with accruals.
Royal Caribbean Group Sloan Ratio % Related Terms
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Royal Caribbean Group (Royal Caribbean Group) Business Description
Royal Caribbean is the world's second-largest cruise company, operating 64 ships across five global and partner brands in the cruise vacation industry, with 10 more ships on order. Brands the company operates include Royal Caribbean International, Celebrity Cruises, and Silversea. The company also has a 50% investment in a joint venture that operates TUI Cruises and Hapag-Lloyd Cruises. The selection of brands in the portfolio allows Royal to compete on the basis of innovation, quality of ships and service, variety of itineraries, choice of destinations, and price. The company completed the divestiture of its Azamara brand in the first quarter of 2021.
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