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.
As of Dec. 2023, Morgan Advanced Materials has a Sloan Ratio of 2.83%, indicating the company is in the safe zone and there is no funny business with accruals.
Morgan Advanced Materials Sloan Ratio % Historical Data
* 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 Morgan Advanced Materials's Sloan Ratio %
For the Specialty Industrial Machinery subindustry, Morgan Advanced Materials'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.
Morgan Advanced Materials's Sloan Ratio % Distribution in the Industrial Products Industry
For the Industrial Products industry and Industrials sector, Morgan Advanced Materials's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Morgan Advanced Materials's Sloan Ratio % falls into.
Morgan Advanced Materials 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.
Morgan Advanced Materials's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
For company reported semi-annually, GuruFocus uses latest two semi-annual data as the TTM data.
Morgan Advanced Materials's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 14.8 (Jun. 2023 ) + 32.5 (Dec. 2023 ) = £47 Mil.
Morgan Advanced Materials's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was -10.7 (Jun. 2023 ) + 89.2 (Dec. 2023 ) = £79 Mil.
Morgan Advanced Materials's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -22 (Jun. 2023 ) + -38.2 (Dec. 2023 ) = £-60 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.
Morgan Advanced Materials (CHIX:MGAMl) 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, Morgan Advanced Materials has a Sloan Ratio of 2.83%, indicating the company is in the safe zone and there is no funny business with accruals.
Morgan Advanced Materials Sloan Ratio % Related Terms
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Morgan Advanced Materials (CHIX:MGAML) Business Description
Morgan Advanced Materials PLC is a U.K.-based company that manufactures a wide array of specialized and high-specification materials. The company's product line includes high-temperature insulation products used to reduce energy consumption, electrical carbon, linear and rotary transfer systems used for transferring electrical energy in motor and generator applications, seals and bearings, ceramic cores, piezoelectric sensors and transducers, crucibles, and others. The company's customers come from sectors including healthcare, petrochemical, transportation, electronics, energy, security and defense, and other industrial applications. Morgan Advanced Materials has a global presence, with the United States being the largest markets for the company.
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