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.
Liquidity Services's Sloan Ratio for the quarter that ended in Mar. 2024 was -2.50%.
As of Mar. 2024, Liquidity Services has a Sloan Ratio of -2.50%, indicating the company is in the safe zone and there is no funny business with accruals.
Liquidity Services Sloan Ratio % Historical Data
The historical data trend for Liquidity Services'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 Liquidity Services's Sloan Ratio %
For the Internet Retail subindustry, Liquidity Services'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.
Liquidity Services's Sloan Ratio % Distribution in the Retail - Cyclical Industry
For the Retail - Cyclical industry and Consumer Cyclical sector, Liquidity Services's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Liquidity Services's Sloan Ratio % falls into.
Liquidity Services 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.
Liquidity Services's Sloan Ratio for the fiscal year that ended in Sep. 2023 is calculated as
Liquidity Services's Net Income for the trailing twelve months (TTM) ended in Mar. 2024 was 6.487 (Jun. 2023 ) + 6.28 (Sep. 2023 ) + 1.907 (Dec. 2023 ) + 5.709 (Mar. 2024 ) = $20.4 Mil.
Liquidity Services's Cash Flow from Operations for the trailing twelve months (TTM) ended in Mar. 2024 was 10.021 (Jun. 2023 ) + 14.66 (Sep. 2023 ) + -8.873 (Dec. 2023 ) + 34.846 (Mar. 2024 ) = $50.7 Mil.
Liquidity Services's Cash Flow from Investing for the trailing twelve months (TTM) ended in Mar. 2024 was -3.094 (Jun. 2023 ) + -1.982 (Sep. 2023 ) + -2.083 (Dec. 2023 ) + -15.508 (Mar. 2024 ) = $-22.7 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.
Liquidity Services (NAS:LQDT) 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, Liquidity Services has a Sloan Ratio of -2.50%, indicating the company is in the safe zone and there is no funny business with accruals.
Liquidity Services Sloan Ratio % Related Terms
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Liquidity Services (Liquidity Services) Business Description
Liquidity Services Inc is an online auction marketplace. It manages and sells inventory and equipment for business and government clients by operating a network of e-commerce marketplaces that enable buyers and sellers to transact in an efficient, automated environment offering across different product categories. The company has four reportable segments: GovDeals, Capital Assets Group (CAG), Retail Supply Chain Group (RSCG), and Machinio. It generates majority of its revenue from Retail Supply Chain Group (RSCG) segment which consists of marketplaces that enable corporations located in the United States and Canada to sell excess, returned, and overstocked consumer goods. Geographically, a substantial portion the company's revenue is generated from its business in United States.
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