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.
Macatawa Bank's Sloan Ratio for the quarter that ended in Dec. 2023 was 4.99%.
As of Dec. 2023, Macatawa Bank has a Sloan Ratio of 4.99%, indicating the company is in the safe zone and there is no funny business with accruals.
Macatawa Bank Sloan Ratio % Historical Data
The historical data trend for Macatawa Bank'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 Macatawa Bank's Sloan Ratio %
For the Banks - Regional subindustry, Macatawa Bank'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.
Macatawa Bank's Sloan Ratio % Distribution in the Banks Industry
For the Banks industry and Financial Services sector, Macatawa Bank's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Macatawa Bank's Sloan Ratio % falls into.
Macatawa Bank 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.
Macatawa Bank's Sloan Ratio for the fiscal year that ended in Dec. 2023 is calculated as
Macatawa Bank's Net Income for the trailing twelve months (TTM) ended in Dec. 2023 was 12.004 (Mar. 2023 ) + 10.312 (Jun. 2023 ) + 11.413 (Sep. 2023 ) + 9.495 (Dec. 2023 ) = $43.2 Mil.
Macatawa Bank's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2023 was 12.729 (Mar. 2023 ) + 10.109 (Jun. 2023 ) + 8.164 (Sep. 2023 ) + 12.798 (Dec. 2023 ) = $43.8 Mil.
Macatawa Bank's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2023 was -60.166 (Mar. 2023 ) + -34.825 (Jun. 2023 ) + -2.929 (Sep. 2023 ) + -39.858 (Dec. 2023 ) = $-137.8 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.
Macatawa Bank (NAS:MCBC) 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 Dec. 2023, Macatawa Bank has a Sloan Ratio of 4.99%, indicating the company is in the safe zone and there is no funny business with accruals.
Macatawa Bank Sloan Ratio % Related Terms
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Macatawa Bank (Macatawa Bank) Business Description
Macatawa Bank Corp is the United states based holding company of Macatawa Bank. The Bank operates in twenty-six branch offices and a lending and operational service facility, providing a range of commercial and consumer banking and trust services in Kent County, Ottawa County, and northern Allegan County, Michigan. It also provides a range of loan products to business customers, including commercial and industrial and commercial real estate loans, and to retail customers, including residential mortgage and consumer loans. In addition, other services provided by the company includes internet banking, debit cards services and brokerage services. The Company's primary sources of revenue are derived from interest and dividends earned on loans, securities and other financial instruments.
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