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.
Dechra Pharmaceuticals's Sloan Ratio for the quarter that ended in Jun. 2023 was 21.33%.
As of Jun. 2023, Dechra Pharmaceuticals has a Sloan Ratio of 21.33%, indicating there is a warning stage of accrual build up.
Dechra Pharmaceuticals 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 Dechra Pharmaceuticals's Sloan Ratio %
For the Drug Manufacturers - General subindustry, Dechra Pharmaceuticals'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.
Dechra Pharmaceuticals's Sloan Ratio % Distribution in the Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Dechra Pharmaceuticals's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Dechra Pharmaceuticals's Sloan Ratio % falls into.
Dechra Pharmaceuticals 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.
Dechra Pharmaceuticals's Sloan Ratio for the fiscal year that ended in Jun. 2023 is calculated as
For company reported semi-annually, GuruFocus uses latest two semi-annual data as the TTM data.
Dechra Pharmaceuticals's Net Income for the trailing twelve months (TTM) ended in Jun. 2023 was 22.6 (Dec. 2022 ) + -50.5 (Jun. 2023 ) = £-27.9 Mil.
Dechra Pharmaceuticals's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2023 was 51.5 (Dec. 2022 ) + 12.1 (Jun. 2023 ) = £63.6 Mil.
Dechra Pharmaceuticals's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2023 was -408.2 (Dec. 2022 ) + -18 (Jun. 2023 ) = £-426.2 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.
Dechra Pharmaceuticals (LSE:DPH) 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 Jun. 2023, Dechra Pharmaceuticals has a Sloan Ratio of 21.33%, indicating there is a warning stage of accrual build up.
Dechra Pharmaceuticals Sloan Ratio % Related Terms
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Dechra Pharmaceuticals (LSE:DPH) Business Description
Dechra Pharmaceuticals PLC is a major drug manufacturing company with a focus on veterinary pharmaceutical products. The company develops, manufactures, and markets its products exclusively for veterinarians globally. Dechra is structured along three segments, including being European Pharmaceuticals, North American Pharmaceuticals, and Pharmaceuticals Research and Development. The vast majority of Dechra's revenue is generated in Europe, followed by the U.S. Dechra derives most of its revenue through its Companion Animal Product category, followed by food-producing animal products.
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