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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. 2025, China Water Affairs Group has a Sloan Ratio of 0.89%, indicating the company is in the safe zone and there is no funny business with accruals.
China Water Affairs Group (OTCPK:CWAFF) 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. 2025, China Water Affairs Group has a Sloan Ratio of 0.89%, indicating the company is in the safe zone and there is no funny business with accruals.
China Water Affairs Group Sloan Ratio % Related Terms
China Water Affairs Group 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.
For the Utilities - Regulated Water subindustry, China Water Affairs Group'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.
China Water Affairs Group Sloan Ratio % vs Utilities - Regulated Industry
For the Utilities - Regulated industry and Utilities sector, China Water Affairs Group's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where China Water Affairs Group's Sloan Ratio % falls into.
China Water Affairs Group 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.
China Water Affairs Group's Sloan Ratio for the fiscal year that ended in Mar. 2025 is calculated as
For company reported semi-annually, GuruFocus uses latest two semi-annual data as the TTM data.
China Water Affairs Group's Net Income for the trailing twelve months (TTM) ended in Sep. 2025 was 41.042 (Mar. 2025 ) + 73.381 (Sep. 2025 ) = $114 Mil.
China Water Affairs Group's Cash Flow from Operations for the trailing twelve months (TTM) ended in Sep. 2025 was 344.601 (Mar. 2025 ) + 50.176 (Sep. 2025 ) = $395 Mil.
China Water Affairs Group's Cash Flow from Investing for the trailing twelve months (TTM) ended in Sep. 2025 was -196.312 (Mar. 2025 ) + -161.973 (Sep. 2025 ) = $-358 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.
China Water Affairs Group (CWAFF) has a Sloan Ratio % of 0.89% as of Sep. 2025. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on China Water Affairs Group and its competitors.
Is China Water Affairs Group's Sloan Ratio % too high?
China Water Affairs Group's current Sloan Ratio % is 0.89%. Overall, China Water Affairs Group has a GF Score™ of 40/100, reflecting its overall financial health beyond just this single metric.
How does China Water Affairs Group's Sloan Ratio % compare to AWK and WTRG?
China Water Affairs Group's Sloan Ratio % of 0.89% can be compared against companies in the Utilities - Regulated 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 Utilities - Regulated company?
A good Sloan Ratio % depends on the Utilities - Regulated 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 China Water Affairs Group and its competitors. China Water Affairs Group's current Sloan Ratio % is 0.89%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is China Water Affairs Group stock overvalued right now?
China Water Affairs Group (CWAFF) has a current Sloan Ratio % of 0.89%. The stock's GF Value™ is $0.60, compared to a current price of $0.62 — trading 3.3% above its estimated fair value. The current Sloan Ratio % is 0.89%. China Water Affairs Group's overall GF Score™ is 40/100 with 10 warning signs to review. 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 China Water Affairs Group (CWAFF), the current Sloan Ratio % is 0.89% as of Sep. 2025. 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.
Is China Water Affairs Group (CWAFF) Overvalued in 2026?
Based on GuruFocus' analysis, China Water Affairs Group stock appears to be overvalued.
The current stock price of $0.62 is trading 3.3% above its estimated GF Value™ of $0.60.
Key valuation signals for CWAFF:
Sloan Ratio %: 0.89%
GF Value™: $0.60 vs. price of $0.62 (3.3% above fair value)
No single metric tells the full story. See the CWAFF stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
China Water Affairs Group Ltd is a Chinese water utility company that builds, operates, and invests in water affairs projects in China. The firm's primary segments include City water supply operation, main contractor construction, Environmental protection, and Pipeline direct drinking water supply. It generates a majority of its revenue from the City water supply operation segment. Geographically, the company generates a maximum share of its revenue from the People's Republic of China.
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