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Marston's passes   / 8 of the Cash Accruals Screen Strategy.
History This screen is loosely based on the influential work of Richard Sloan from the University of Michigan, published in 1996 documenting what is referred to as the “accrual anomaly”. A pound of earnings can be comprised of assumed non-cash earnings called “accruals.” His landmark 1996 paper revealed that shares of companies with small or negative accruals vastly outperform (+10%) those of companies with large ones His paper found that investors focus too heavily on earnings and not on cash generation. They value the earnings of a high accrual company just as highly as the same earnings of a low accrual company, even though the high accrual company’s earnings are more likely to reverse in future years. When future earnings reverse, investors are “surprised” and sell off the stock causing the stock price to decline. Similarly, when a low accrual company’s earnings accelerate in future years, they are surprised in a good way. more »

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Mkt Cap £m > 150
OCF > Net Profit before Extraords
OCF PS > 0
EPS 3y CAGR % > 15
EPS Gwth % > EPS 3y CAGR %
P/E < Median
Industry Group not in Collective Investments,
Qualifies in the top 30 stocks sorted by Accrual Ratio ascending

Click Here to view all the stocks qualifying under this Strategy.

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