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.
Whole Foods Market's Sloan Ratio for the quarter that ended in Jun. 2017 was 6.66%.
As of Jun. 2017, Whole Foods Market has a Sloan Ratio of 6.66%, indicating the company is in the safe zone and there is no funny business with accruals.
Whole Foods Market Sloan Ratio % Historical Data
The historical data trend for Whole Foods Market'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 Whole Foods Market's Sloan Ratio %
For the Grocery Stores subindustry, Whole Foods Market'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.
Whole Foods Market's Sloan Ratio % Distribution in the Retail - Defensive Industry
For the Retail - Defensive industry and Consumer Defensive sector, Whole Foods Market's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Whole Foods Market's Sloan Ratio % falls into.
Whole Foods Market 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.
Whole Foods Market's Sloan Ratio for the fiscal year that ended in Sep. 2016 is calculated as
Whole Foods Market's Net Income for the trailing twelve months (TTM) ended in Jun. 2017 was 88 (Sep. 2016 ) + 95 (Dec. 2016 ) + 99 (Mar. 2017 ) + 106 (Jun. 2017 ) = $388 Mil.
Whole Foods Market's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2017 was 352 (Sep. 2016 ) + 284 (Dec. 2016 ) + 340 (Mar. 2017 ) + 277 (Jun. 2017 ) = $1,253 Mil.
Whole Foods Market's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2017 was -418 (Sep. 2016 ) + -244 (Dec. 2016 ) + -236 (Mar. 2017 ) + -407 (Jun. 2017 ) = $-1,305 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.
Whole Foods Market (NAS:WFM) 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. 2017, Whole Foods Market has a Sloan Ratio of 6.66%, indicating the company is in the safe zone and there is no funny business with accruals.
Whole Foods Market Sloan Ratio % Related Terms
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Whole Foods Market (Whole Foods Market) Business Description
Whole Foods Market is the world's leading retailer of natural and organic foods by units and is the first certified organic grocer in the United States. Whole Foods' only operating segment consists of natural and organic foods supermarkets. As of fiscal 2016, the company had 456 stores in the United States, Canada, and the United Kingdom. The average store size is about 39,000 square feet. About 15% of the company's sales were derived from the sale of private-label products. The company announced a pending acquisition by Amazon in June 2017.
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