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.
Entergy's Sloan Ratio for the quarter that ended in Mar. 2024 was 4.68%.
As of Mar. 2024, Entergy has a Sloan Ratio of 4.68%, indicating the company is in the safe zone and there is no funny business with accruals.
Entergy Sloan Ratio % Historical Data
The historical data trend for Entergy'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.
For the Utilities - Regulated Electric subindustry, Entergy'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.
Entergy's Sloan Ratio % Distribution in the Utilities - Regulated Industry
For the Utilities - Regulated industry and Utilities sector, Entergy's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Entergy's Sloan Ratio % falls into.
Entergy 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.
Entergy's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Entergy's Net Income for the trailing twelve months (TTM) ended in Mar. 2024 was 392.014 (Jun. 2023 ) + 669.714 (Sep. 2023 ) + 988.284 (Dec. 2023 ) + 76.536 (Mar. 2024 ) = $2,127 Mil.
Entergy's Cash Flow from Operations for the trailing twelve months (TTM) ended in Mar. 2024 was 866.429 (Jun. 2023 ) + 1405.021 (Sep. 2023 ) + 1063.335 (Dec. 2023 ) + 521.092 (Mar. 2024 ) = $3,856 Mil.
Entergy's Cash Flow from Investing for the trailing twelve months (TTM) ended in Mar. 2024 was -1161.84 (Jun. 2023 ) + -1133.631 (Sep. 2023 ) + -1049.915 (Dec. 2023 ) + -1287.872 (Mar. 2024 ) = $-4,633 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.
Entergy (NYSE:ETR) 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, Entergy has a Sloan Ratio of 4.68%, indicating the company is in the safe zone and there is no funny business with accruals.
Entergy Sloan Ratio % Related Terms
Thank you for viewing the detailed overview of Entergy's Sloan Ratio % provided by GuruFocus.com. Please click on the following links to see related term pages.
Entergy is a holding company with five regulated integrated utilities that generate and distribute electricity to about 3 million customers in Arkansas, Louisiana, Mississippi, and Texas. It is one of the largest power producers in the country with approximately 23 gigawatts of rate-regulated utility-owned power generation capacity. Entergy was the second-largest nuclear owner in the U.S. before it began retiring and selling its plants in the Northeast in 2014.
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