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.
Veritex Holdings's Sloan Ratio for the quarter that ended in Mar. 2024 was 1.25%.
As of Mar. 2024, Veritex Holdings has a Sloan Ratio of 1.25%, indicating the company is in the safe zone and there is no funny business with accruals.
Veritex Holdings Sloan Ratio % Historical Data
The historical data trend for Veritex 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 Veritex Holdings's Sloan Ratio %
For the Banks - Regional subindustry, Veritex 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.
Veritex Holdings's Sloan Ratio % Distribution in the Banks Industry
For the Banks industry and Financial Services sector, Veritex Holdings's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Veritex Holdings's Sloan Ratio % falls into.
Veritex 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.
Veritex Holdings's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Veritex Holdings's Net Income for the trailing twelve months (TTM) ended in Mar. 2024 was 33.73 (Jun. 2023 ) + 32.621 (Sep. 2023 ) + 3.499 (Dec. 2023 ) + 24.156 (Mar. 2024 ) = $94.0 Mil.
Veritex Holdings's Cash Flow from Operations for the trailing twelve months (TTM) ended in Mar. 2024 was 63.778 (Jun. 2023 ) + 39.751 (Sep. 2023 ) + 6.019 (Dec. 2023 ) + 44.269 (Mar. 2024 ) = $153.8 Mil.
Veritex Holdings's Cash Flow from Investing for the trailing twelve months (TTM) ended in Mar. 2024 was -41.762 (Jun. 2023 ) + 183.168 (Sep. 2023 ) + -122.401 (Dec. 2023 ) + -237.123 (Mar. 2024 ) = $-218.1 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.
Veritex Holdings (NAS:VBTX) 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 Mar. 2024, Veritex Holdings has a Sloan Ratio of 1.25%, indicating the company is in the safe zone and there is no funny business with accruals.
Veritex Holdings Sloan Ratio % Related Terms
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Veritex Holdings (Veritex Holdings) Business Description
Veritex Holdings Inc is engaged in the provision of commercial banking products and services to small to medium-sized businesses and professionals. The bank provides a range of banking services to individual and corporate customers, which include commercial and retail lending, and the acceptance of checking and savings deposits. It offers a suite of online banking solutions, including access to account balances, online transfers, online bill payment and electronic delivery of customer statements, as well as automated teller machines, and banking by telephone, mail and personal appointment. The company's primary sources of revenue are derived from interest and dividends earned on loans, debt and equity securities and other financial instruments.
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