Richard Sloan found that companies with low (or negative) accrual ratios outperform companies with high accrual ratios.
Over a 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% compared to the S&P 500’s 7.4% annual return over the same period.
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