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.
Butterfly Network's Sloan Ratio for the quarter that ended in Mar. 2024 was -14.11%.
Warning Sign:
When sloan ratio (-34.6)% higher than 25% or lower than -25%, earnings are more likely to be made up of accruals.
As of Mar. 2024, Butterfly Network has a Sloan Ratio of -14.11%, indicating earnings are more likely to be made up of accruals.
Butterfly Network Sloan Ratio % Historical Data
The historical data trend for Butterfly Network'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 Butterfly Network's Sloan Ratio %
For the Medical Devices subindustry, Butterfly Network'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.
Butterfly Network's Sloan Ratio % Distribution in the Medical Devices & Instruments Industry
For the Medical Devices & Instruments industry and Healthcare sector, Butterfly Network's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Butterfly Network's Sloan Ratio % falls into.
Butterfly Network 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.
Butterfly Network's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Butterfly Network's Net Income for the trailing twelve months (TTM) ended in Mar. 2024 was -28.671 (Jun. 2023 ) + -27.368 (Sep. 2023 ) + -44.121 (Dec. 2023 ) + -21.761 (Mar. 2024 ) = $-121.92 Mil.
Butterfly Network's Cash Flow from Operations for the trailing twelve months (TTM) ended in Mar. 2024 was -26.486 (Jun. 2023 ) + -15.981 (Sep. 2023 ) + -13.101 (Dec. 2023 ) + -20.667 (Mar. 2024 ) = $-76.24 Mil.
Butterfly Network's Cash Flow from Investing for the trailing twelve months (TTM) ended in Mar. 2024 was -0.881 (Jun. 2023 ) + -1.048 (Sep. 2023 ) + -2.512 (Dec. 2023 ) + -1.138 (Mar. 2024 ) = $-5.58 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.
Butterfly Network (NYSE:BFLY) 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, Butterfly Network has a Sloan Ratio of -14.11%, indicating earnings are more likely to be made up of accruals.
Butterfly Network Sloan Ratio % Related Terms
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Butterfly Network (Butterfly Network) Business Description
Butterfly Network Inc is a digital health business transforming care with handheld, whole-body ultrasound. Powered by its proprietary Ultrasound-on-Chip technology, its solution enables the acquisition of imaging information from an affordable, powerful device that fits in a healthcare professional's pocket with a combination of cloud-connected software and hardware technology that is easily accessed through a mobile application. Butterfly enables the practical application of ultrasound information in the clinical workflow. Butterfly iQ+ is an ultrasound device that can perform whole-body imaging in a single handheld probe using semiconductor technology. With its small, handheld size, low cost, and simple user interface.
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