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.
Medidata Solutions's Sloan Ratio for the quarter that ended in Jun. 2019 was -28.25%.
As of Jun. 2019, Medidata Solutions has a Sloan Ratio of -28.25%, indicating there is a warning stage of accrual build up.
Medidata Solutions Sloan Ratio % Historical Data
The historical data trend for Medidata Solutions'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 Medidata Solutions's Sloan Ratio %
For the Health Information Services subindustry, Medidata Solutions'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.
Medidata Solutions's Sloan Ratio % Distribution in the Healthcare Providers & Services Industry
For the Healthcare Providers & Services industry and Healthcare sector, Medidata Solutions's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Medidata Solutions's Sloan Ratio % falls into.
Medidata Solutions 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.
Medidata Solutions's Sloan Ratio for the fiscal year that ended in Dec. 2018 is calculated as
Medidata Solutions's Net Income for the trailing twelve months (TTM) ended in Jun. 2019 was 10.688 (Sep. 2018 ) + 14.319 (Dec. 2018 ) + 11.145 (Mar. 2019 ) + 7.893 (Jun. 2019 ) = $44.0 Mil.
Medidata Solutions's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2019 was 33.471 (Sep. 2018 ) + 31.929 (Dec. 2018 ) + 6.084 (Mar. 2019 ) + 24.324 (Jun. 2019 ) = $95.8 Mil.
Medidata Solutions's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2019 was 212.582 (Sep. 2018 ) + -10.989 (Dec. 2018 ) + 19.724 (Mar. 2019 ) + 16.172 (Jun. 2019 ) = $237.5 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.
Medidata Solutions (NAS:MDSO) 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 Jun. 2019, Medidata Solutions has a Sloan Ratio of -28.25%, indicating there is a warning stage of accrual build up.
Medidata Solutions Sloan Ratio % Related Terms
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Medidata Solutions (Medidata Solutions) Business Description
Medidata Solutions Inc provides cloud-based solutions for the clinical development programs of life sciences companies. Its customers include biopharmaceutical companies, device makers, contract research organizations, and academic institutions. The majority of the company's business comes from subscriptions to the Medidata Clinical Cloud, with the remainder of revenue coming from services. The Medidata Clinical Cloud provides solutions for study design and planning, data capture, patient activity measurement, risk-based monitoring, and payments. The services segment includes technology and support services and professional consulting services. The majority of the firm's revenue is generated within the United States.
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