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.
* 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 Postmedia Network Canada's Sloan Ratio %
For the Publishing subindustry, Postmedia Network Canada'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.
Postmedia Network Canada's Sloan Ratio % Distribution in the Media - Diversified Industry
For the Media - Diversified industry and Communication Services sector, Postmedia Network Canada's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Postmedia Network Canada's Sloan Ratio % falls into.
Postmedia Network Canada 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.
Postmedia Network Canada's Sloan Ratio for the fiscal year that ended in Aug. 2023 is calculated as
Postmedia Network Canada's Net Income for the trailing twelve months (TTM) ended in Feb. 2024 was -24.837 (May. 2023 ) + -11.044 (Aug. 2023 ) + -10.608 (Nov. 2023 ) + -20.097 (Feb. 2024 ) = C$-66.6 Mil.
Postmedia Network Canada's Cash Flow from Operations for the trailing twelve months (TTM) ended in Feb. 2024 was -5.277 (May. 2023 ) + -8.205 (Aug. 2023 ) + -5.009 (Nov. 2023 ) + 1.147 (Feb. 2024 ) = C$-17.3 Mil.
Postmedia Network Canada's Cash Flow from Investing for the trailing twelve months (TTM) ended in Feb. 2024 was 1.039 (May. 2023 ) + 6.535 (Aug. 2023 ) + 1.998 (Nov. 2023 ) + 0.351 (Feb. 2024 ) = C$9.9 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.
Postmedia Network Canada (TSX:PNC.B) 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 Feb. 2024, Postmedia Network Canada has a Sloan Ratio of -41.69%, indicating earnings are more likely to be made up of accruals.
Postmedia Network Canada Sloan Ratio % Related Terms
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Postmedia Network Canada (TSX:PNC.B) Business Description
Postmedia Network Canada Corp is a holding company. It operates through the Newsmedia segment. The company's business consists of news and information gathering and dissemination operations, with products offered in local, regional and metropolitan markets in Canada through multiple print, online and mobile platforms. Postmedia's operations include an extensive distribution network, which also offers distribution services, for advertising flyers and parcels. The combination of these distribution platforms provides audiences with a variety of media through which to access and interact with Postmedia's content. The breadth of the company's reach and the diversity of its content enable advertisers to reach target audiences on a local, regional or national scale.
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