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.
CapitalSource's Sloan Ratio for the quarter that ended in Dec. 2013 was 3.05%.
As of Dec. 2013, CapitalSource has a Sloan Ratio of 3.05%, indicating the company is in the safe zone and there is no funny business with accruals.
CapitalSource Sloan Ratio % Historical Data
The historical data trend for CapitalSource'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 CapitalSource's Sloan Ratio %
For the Credit Services subindustry, CapitalSource'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.
CapitalSource's Sloan Ratio % Distribution in the Credit Services Industry
For the Credit Services industry and Financial Services sector, CapitalSource's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where CapitalSource's Sloan Ratio % falls into.
CapitalSource 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.
CapitalSource's Sloan Ratio for the fiscal year that ended in Dec. 2013 is calculated as
CapitalSource's Net Income for the trailing twelve months (TTM) ended in Dec. 2013 was 22.657 (Mar. 2013 ) + 21.696 (Jun. 2013 ) + 36.202 (Sep. 2013 ) + 42.284 (Dec. 2013 ) = €122.8 Mil.
CapitalSource's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2013 was 45.091 (Mar. 2013 ) + 72.127 (Jun. 2013 ) + 28.813 (Sep. 2013 ) + 51.846 (Dec. 2013 ) = €197.9 Mil.
CapitalSource's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2013 was 46.395 (Mar. 2013 ) + -212.542 (Jun. 2013 ) + 6.681 (Sep. 2013 ) + -114.123 (Dec. 2013 ) = €-273.6 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.
CapitalSource (FRA:CAU) 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. 2013, CapitalSource has a Sloan Ratio of 3.05%, indicating the company is in the safe zone and there is no funny business with accruals.
CapitalSource Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of CapitalSource's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
CapitalSource Inc., incorporated in the state of Delaware. It is a commercial lender that provides financial products to middle market businesses. Through its wholly owned subsidiary, CapitalSource Bank, the Company provides depository products and services in southern and central California. Its main products include: Depository Products and Services; First Mortgage Loans; Senior Secured Asset-Based Loans; Senior Secured Cash Flow Loans; Direct Real Estate Investments; Term B, Second Lien and Mezzanine Loans; Equity Investments; and Residential Mortgage Investments. The Company currently operates as three reportable segments: Commercial Banking, Healthcare Net Lease and Residential Mortgage Investment. Its Commercial Banking segment comprises commercial lending and banking business activities; Healthcare Net Lease segment comprises its direct real estate investment business activities; and Residential Mortgage Investment segment comprises its residential mortgage investment and other investment activities formally engaged in to optimize its REIT qualification. Through Commercial Banking segment activities, the Company provides a range of financial products to middle market businesses and participates in broadly syndicated debt financings for larger businesses. Through Healthcare Net Lease segment activities, it invests in income-producing healthcare facilities, mainly long-term care facilities in the United States. The Company provides lease financing to skilled nursing facilities and, to a lesser extent, assisted living facilities, and long term acute care facilities. In its Commercial Banking and Healthcare Net Lease segments, the Company has three commercial lending businesses: Healthcare and Specialty Finance, which provides first mortgage loans, asset-based revolving lines of credit, and cash flow loans to healthcare businesses and, to a lesser extent, a range of other companies; Corporate Finance, which provides senior and subordinate loans through direct origination and participation in syndicated loan transactions; and Structured Finance, which engages in commercial and residential real estate finance and also provides asset-based lending to finance companies. The Company's markets are competitive and characterized by varying competitive factors. Some of its competitors have considerable market positions. The Company's bank operations are subject to regulation by federal and state regulatory agencies. This regulation is intended mainly for the protection of depositors and the deposit insurance fund, and secondarily for the stability of the U.S. banking system.
Quick Browse
Personalize
Premium Gurus 
Create New Portfolio
Portfolio Contest
FRA:CAU has been successfully added to your 