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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.
As of Sep. 2010, American Metal & Technology has a Sloan Ratio of 13.16%, indicating there is a warning stage of accrual build up.
American Metal & Technology (OTCPK:AMGY) 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 Sep. 2010, American Metal & Technology has a Sloan Ratio of 13.16%, indicating there is a warning stage of accrual build up.
American Metal & Technology Sloan Ratio % Related Terms
American Metal & Technology 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.
American Metal & Technology Sloan Ratio % Competitor Comparison
For the Metal Fabrication subindustry, American Metal & Technology'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.
American Metal & Technology Sloan Ratio % vs Industrial Products Industry
For the Industrial Products industry and Industrials sector, American Metal & Technology's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where American Metal & Technology's Sloan Ratio % falls into.
American Metal & Technology 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.
American Metal & Technology's Net Income for the trailing twelve months (TTM) ended in Sep. 2010 was -0.261 (Dec. 2009 ) + -0.105 (Mar. 2010 ) + 0.316 (Jun. 2010 ) + 0.463 (Sep. 2010 ) = $0.41 Mil.
American Metal & Technology's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2010 was -0.066 (Dec. 2009 ) + -0.38 (Mar. 2010 ) + -0.464 (Jun. 2010 ) + -0.72 (Sep. 2010 ) = $-1.63 Mil.
American Metal & Technology's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2010 was -0.369 (Dec. 2009 ) + -0.007 (Mar. 2010 ) + -0.022 (Jun. 2010 ) + -0.186 (Sep. 2010 ) = $-0.58 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.
American Metal & Technology (AMGY) has a Sloan Ratio % of 13.16% as of Sep. 2010. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on American Metal & Technology and its competitors.
Is American Metal & Technology's Sloan Ratio % too high?
American Metal & Technology's current Sloan Ratio % is 13.16%.
How does American Metal & Technology's Sloan Ratio % compare to competitors?
American Metal & Technology's Sloan Ratio % of 13.16% can be compared against companies in the Industrial Products industry. See the competitive comparison table and distribution chart on this page for a detailed peer-by-peer breakdown.
What is a good Sloan Ratio % for an Industrial Products company?
A good Sloan Ratio % depends on the Industrial Products industry context. However, Sloan Ratio % should not be evaluated in isolation — investors should consider it alongside profitability, growth, and financial strength metrics. Use the industry distribution chart on this page to see where any company falls relative to its peers.
What does a high Sloan Ratio % mean?
A high Sloan Ratio % can signal that a stock is expensive relative to its fundamentals. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on American Metal & Technology and its competitors. American Metal & Technology's current Sloan Ratio % is 13.16%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is American Metal & Technology stock overvalued right now?
American Metal & Technology (AMGY) has a current Sloan Ratio % of 13.16%. The current Sloan Ratio % is 13.16%. Investors should evaluate multiple metrics — including profitability, growth, and financial strength — before making a decision.
How is Sloan Ratio % calculated?
Sloan Ratio % is calculated from a company's financial statements. For American Metal & Technology (AMGY), the current Sloan Ratio % is 13.16% as of Sep. 2010. GuruFocus calculates this using data sourced from SEC filings and annual reports. See the calculation section and 30-year financial data on this page for the full breakdown.
American Metal & Technology Inc through its subsidiaries is engaged in precision casting, machining, mold design and manufacturing in the People's Republic of China. It manufacture investment casting and machined products, including valves, pipe fittings, dispensers, machinery spare parts, water treatment parts, automotive and airplane accessories, electronic circuit boards for home appliances and motion controllers, and other equipment parts.
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