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.
Home BancShares's Sloan Ratio for the quarter that ended in Dec. 2023 was -2.49%.
As of Dec. 2023, Home BancShares has a Sloan Ratio of -2.49%, indicating the company is in the safe zone and there is no funny business with accruals.
Home BancShares Sloan Ratio % Historical Data
The historical data trend for Home BancShares'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 Home BancShares's Sloan Ratio %
For the Banks - Regional subindustry, Home BancShares'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.
Home BancShares's Sloan Ratio % Distribution in the Banks Industry
For the Banks industry and Financial Services sector, Home BancShares's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Home BancShares's Sloan Ratio % falls into.
Home BancShares 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.
Home BancShares's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Home BancShares's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 102.962 (Mar. 2023 ) + 105.271 (Jun. 2023 ) + 98.453 (Sep. 2023 ) + 86.243 (Dec. 2023 ) = $392.9 Mil.
Home BancShares's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 117.948 (Mar. 2023 ) + 47.108 (Jun. 2023 ) + 99.117 (Sep. 2023 ) + 115.497 (Dec. 2023 ) = $379.7 Mil.
Home BancShares's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was 381.14 (Mar. 2023 ) + 299.476 (Jun. 2023 ) + -1.808 (Sep. 2023 ) + -100.349 (Dec. 2023 ) = $578.5 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.
Home BancShares (NYSE:HOMB) 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, Home BancShares has a Sloan Ratio of -2.49%, indicating the company is in the safe zone and there is no funny business with accruals.
Home BancShares Sloan Ratio % Related Terms
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Home BancShares (Home BancShares) Business Description
Home BancShares Inc is a bank holding company that primarily operates through its wholly owned community bank subsidiary, Centennial Bank. The bank provides a broad range of commercial and retail banking, as well as related financial services, to a diverse customer base. Its customer base includes businesses, real estate developers and investors, individuals, and municipalities. The company's loan portfolio, while diversified, is typically between half and two thirds in commercial real estate loans. The company's strategy emphasizes growth, both through strategic acquisitions and organically within its existing markets. The bank also emphasizes attracting experienced bankers, strong credit quality, and a solid balance sheet. The bank's main source of net revenue is net interest income.
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