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.
As of Dec. 2023, Reckitt Benckiser Group has a Sloan Ratio of -1.95%, indicating the company is in the safe zone and there is no funny business with accruals.
Reckitt Benckiser Group Sloan Ratio % Historical Data
* 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 Reckitt Benckiser Group's Sloan Ratio %
For the Household & Personal Products subindustry, Reckitt Benckiser Group'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.
Reckitt Benckiser Group's Sloan Ratio % Distribution in the Consumer Packaged Goods Industry
For the Consumer Packaged Goods industry and Consumer Defensive sector, Reckitt Benckiser Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Reckitt Benckiser Group's Sloan Ratio % falls into.
Reckitt Benckiser Group 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.
Reckitt Benckiser Group's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
For company reported semi-annually, GuruFocus uses latest two semi-annual data as the TTM data.
Reckitt Benckiser Group's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 1566.919 (Jun. 2023 ) + 508.861 (Dec. 2023 ) = $2,076 Mil.
Reckitt Benckiser Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 1180.556 (Jun. 2023 ) + 2153.165 (Dec. 2023 ) = $3,334 Mil.
Reckitt Benckiser Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -234.848 (Jun. 2023 ) + -354.43 (Dec. 2023 ) = $-589 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.
Reckitt Benckiser Group (OTCPK:RBGPF) 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, Reckitt Benckiser Group has a Sloan Ratio of -1.95%, indicating the company is in the safe zone and there is no funny business with accruals.
Reckitt Benckiser Group Sloan Ratio % Related Terms
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Reckitt Benckiser Group (Reckitt Benckiser Group) Business Description
Reckitt Benckiser was formed in 1999 through the merger of the British firm Reckitt & Colman and Dutch-based Benckiser. Recently rebranded under the corporate name Reckitt, it sells a portfolio that includes a variety of household and consumer health brands, such as Lysol, Finish, Durex, and Mucinex, many of which hold the number-one or -two positions in their categories globally. Reckitt has repositioned its portfolio and has entered the infant formula market through the acquisition of Mead Johnson in 2017, expanded its consumer health presence by acquiring Schiff Nutrition, K-Y, and Biofreeze, and has exited the food industry. The firm operates in 60 countries and sells products in more than 200, generating around 35% of sales from emerging markets.
Reckitt Benckiser Group (Reckitt Benckiser Group) Headlines
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