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.
Fast Retailing Co's Sloan Ratio for the quarter that ended in Feb. 2024 was -3.32%.
As of Feb. 2024, Fast Retailing Co has a Sloan Ratio of -3.32%, indicating the company is in the safe zone and there is no funny business with accruals.
Fast Retailing Co Sloan Ratio % Historical Data
The historical data trend for Fast Retailing Co'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 Fast Retailing Co's Sloan Ratio %
For the Apparel Retail subindustry, Fast Retailing Co'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.
Fast Retailing Co's Sloan Ratio % Distribution in the Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, Fast Retailing Co's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Fast Retailing Co's Sloan Ratio % falls into.
Fast Retailing Co 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.
Fast Retailing Co's Sloan Ratio for the fiscal year that ended in Aug. 2023 is calculated as
Fast Retailing Co's Net Income for the trailing twelve months (TTM) ended in Feb. 2024 was 621.124 (May. 2023 ) + 398.611 (Aug. 2023 ) + 720.215 (Nov. 2023 ) + 588.918 (Feb. 2024 ) = $2,329 Mil.
Fast Retailing Co's Cash Flow from Operations for the trailing twelve months (TTM) ended in Feb. 2024 was 1010.133 (May. 2023 ) + 1017.541 (Aug. 2023 ) + 716.092 (Nov. 2023 ) + 1438.318 (Feb. 2024 ) = $4,182 Mil.
Fast Retailing Co's Cash Flow from Investing for the trailing twelve months (TTM) ended in Feb. 2024 was -241.337 (May. 2023 ) + -473.572 (Aug. 2023 ) + -296.702 (Nov. 2023 ) + -65.181 (Feb. 2024 ) = $-1,077 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.
Fast Retailing Co (OTCPK:FRCOF) 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 Feb. 2024, Fast Retailing Co has a Sloan Ratio of -3.32%, indicating the company is in the safe zone and there is no funny business with accruals.
Fast Retailing Co Sloan Ratio % Related Terms
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Fast Retailing Co (Fast Retailing Co) Business Description
Fast Retailing Co Ltd is Japan's apparel company, operating the casualwear retail chain Uniqlo, known for its high-quality functional apparel at reasonable prices. The business is founded on a private-label apparel model whereby Fast Retailing is in charge of product design, production, and sales. Fast Retailing is ranked the third-largest apparel company by sales globally, it runs 3,630 stores globally, including 813 and 1,439 Uniqlo stores in Japan and overseas, respectively. Other brands in its portfolio include GU and acquired brands including Theory, Comptoir des Cotonniers, Princesse Tam Tam (French lingerie), and J Brand (premium denim).
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