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.
Bentley Systems's Sloan Ratio for the quarter that ended in Mar. 2024 was -1.50%.
As of Mar. 2024, Bentley Systems has a Sloan Ratio of -1.50%, indicating the company is in the safe zone and there is no funny business with accruals.
Bentley Systems Sloan Ratio % Historical Data
The historical data trend for Bentley Systems'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 Bentley Systems's Sloan Ratio %
For the Software - Application subindustry, Bentley Systems'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.
Bentley Systems's Sloan Ratio % Distribution in the Software Industry
For the Software industry and Technology sector, Bentley Systems's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Bentley Systems's Sloan Ratio % falls into.
Bentley Systems 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.
Bentley Systems's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Bentley Systems's Net Income for the trailing twelve months (TTM) ended in Mar. 2024 was 48.685 (Jun. 2023 ) + 53.027 (Sep. 2023 ) + 179.585 (Dec. 2023 ) + 70.31 (Mar. 2024 ) = $352 Mil.
Bentley Systems's Cash Flow from Operations for the trailing twelve months (TTM) ended in Mar. 2024 was 80.596 (Jun. 2023 ) + 72.824 (Sep. 2023 ) + 87.053 (Dec. 2023 ) + 204.969 (Mar. 2024 ) = $445 Mil.
Bentley Systems's Cash Flow from Investing for the trailing twelve months (TTM) ended in Mar. 2024 was -8.991 (Jun. 2023 ) + -21.493 (Sep. 2023 ) + -9.259 (Dec. 2023 ) + -3.849 (Mar. 2024 ) = $-44 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.
Bentley Systems (NAS:BSY) 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, Bentley Systems has a Sloan Ratio of -1.50%, indicating the company is in the safe zone and there is no funny business with accruals.
Bentley Systems Sloan Ratio % Related Terms
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Bentley Systems (Bentley Systems) Business Description
Bentley Systems is a software vendor that caters to engineers, architects, constructors, and geospatial professionals by enabling design, modeling, simulation and project, and data management of infrastructure assets. The firm delivers solutions via the cloud, desktop, and hybrid environments. While Bentley is relatively small in comparison with peers like Autodesk, it shines in core specialty areas, like bridge or rail design, as opposed to being more broad-based in its applications. As of fiscal 2022, approximately 58% of revenue is derived from outside the U.S. (with 28% of revenue coming from EMEA and 18% coming from APAC as of fiscal 2022). Bentley's largest end market is the public works and utilities sector, which represents approximately two thirds of revenue.
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