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.
WeCommerce Holdings's Sloan Ratio for the quarter that ended in Dec. 2022 was -14.97%.
As of Dec. 2022, WeCommerce Holdings has a Sloan Ratio of -14.97%, indicating there is a warning stage of accrual build up.
WeCommerce Holdings Sloan Ratio % Historical Data
The historical data trend for WeCommerce Holdings'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 WeCommerce Holdings's Sloan Ratio %
For the Software - Application subindustry, WeCommerce Holdings'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.
WeCommerce Holdings's Sloan Ratio % Distribution in the Software Industry
For the Software industry and Technology sector, WeCommerce Holdings's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where WeCommerce Holdings's Sloan Ratio % falls into.
WeCommerce Holdings 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.
WeCommerce Holdings's Sloan Ratio for the fiscal year that ended in Dec. 2022 is calculated as
WeCommerce Holdings's Net Income for the trailing twelve months (TTM) ended in Dec. 2022 was 0.79 (Mar. 2022 ) + -4.529 (Jun. 2022 ) + -6.463 (Sep. 2022 ) + -12.437 (Dec. 2022 ) = C$-22.64 Mil.
WeCommerce Holdings's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2022 was 3.907 (Mar. 2022 ) + 0.988 (Jun. 2022 ) + 2.382 (Sep. 2022 ) + 3.234 (Dec. 2022 ) = C$10.51 Mil.
WeCommerce Holdings's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2022 was -2.68 (Mar. 2022 ) + -4.218 (Jun. 2022 ) + -0.015 (Sep. 2022 ) + -0.522 (Dec. 2022 ) = C$-7.44 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.
WeCommerce Holdings (TSXV:WE) 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. 2022, WeCommerce Holdings has a Sloan Ratio of -14.97%, indicating there is a warning stage of accrual build up.
WeCommerce Holdings Sloan Ratio % Related Terms
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WeCommerce Holdings (TSXV:WE) Business Description
WeCommerce Holdings Ltd is a holding company that owns a family of companies and brands in the Shopify partner ecosystem, including Pixel Union, Out of the Sandbox, Yopify, SuppleApps, Rehash, Stamped and Foursixty. The company's primary focus is to build, grow and acquire businesses that serve the Shopify Partner ecosystem. These businesses consist largely of Software as a Service, Digital Goods and Services businesses. Generally, these businesses build Apps and Themes and run Agencies that support Shopify merchants. The company targets businesses within the Shopify ecosystem due to its confidence in the Shopify platform, the fragmented nature of the ecosystem and the attractive economics that the businesses generally exhibit. Its segments include Themes, Apps and Agency.
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