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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.
Elanco Animal Health's Sloan Ratio for the quarter that ended in Jun. 2026 was -3.55%.
As of Jun. 2026, Elanco Animal Health has a Sloan Ratio of -3.55%, indicating the company is in the safe zone and there is no funny business with accruals.
Elanco Animal Health (NYSE:ELAN) 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 Jun. 2026, Elanco Animal Health has a Sloan Ratio of -3.55%, indicating the company is in the safe zone and there is no funny business with accruals.
Elanco Animal Health Sloan Ratio % Related Terms
Elanco Animal Health Sloan Ratio % Historical Data
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The historical data trend for Elanco Animal Health'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.
ELAN vs NBIX, ALKS, HIMS: Sloan Ratio % Comparison
For the Drug Manufacturers - Specialty & Generic subindustry, Elanco Animal Health'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.
Elanco Animal Health Sloan Ratio % vs Drug Manufacturers Industry
For the Drug Manufacturers industry and Healthcare sector, Elanco Animal Health's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Elanco Animal Health's Sloan Ratio % falls into.
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.
Elanco Animal Health's Sloan Ratio for the fiscal year that ended in Dec. 2025 is calculated as
Elanco Animal Health's Net Income for the trailing twelve months (TTM) ended in Jun. 2026 was -34 (Sep. 2025 ) + -276 (Dec. 2025 ) + 57 (Mar. 2026 ) + 54 (Jun. 2026 ) = $-199 Mil.
Elanco Animal Health's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2026 was 219 (Sep. 2025 ) + 108 (Dec. 2025 ) + 13 (Mar. 2026 ) + 277 (Jun. 2026 ) = $617 Mil.
Elanco Animal Health's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2026 was -101 (Sep. 2025 ) + -64 (Dec. 2025 ) + -60 (Mar. 2026 ) + -110 (Jun. 2026 ) = $-335 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.
Elanco Animal Health (ELAN) has a Sloan Ratio % of -3.55% as of Jun. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Elanco Animal Health and its competitors.
Is Elanco Animal Health's Sloan Ratio % too high?
Elanco Animal Health's current Sloan Ratio % is -3.55%. Overall, Elanco Animal Health has a GF Score™ of 68/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Elanco Animal Health's Sloan Ratio % compare to NBIX and ALKS?
Elanco Animal Health's Sloan Ratio % of -3.55% can be compared against companies in the Drug Manufacturers 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 a Drug Manufacturers company?
A good Sloan Ratio % depends on the Drug Manufacturers 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 Elanco Animal Health and its competitors. Elanco Animal Health's current Sloan Ratio % is -3.55%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Elanco Animal Health stock overvalued right now?
Based on GuruFocus' analysis, Elanco Animal Health (ELAN) is currently considered Significantly Overvalued. The stock's GF Value™ is $16.68, compared to a current price of $23.99 — trading 43.8% above its estimated fair value. The current Sloan Ratio % is -3.55%. Elanco Animal Health's overall GF Score™ is 68/100 with 4 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 Elanco Animal Health (ELAN), the current Sloan Ratio % is -3.55% as of Jun. 2026. 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 Elanco Animal Health (ELAN) Overvalued in 2026?
Based on GuruFocus' analysis, Elanco Animal Health stock appears to be overvalued.
The current stock price of $23.99 is trading 43.8% above its estimated GF Value™ of $16.68.
GuruFocus considers Elanco Animal Health to be Significantly Overvalued.
Key valuation signals for ELAN:
Sloan Ratio %: -3.55%
GF Value™: $16.68 vs. price of $23.99 (43.8% above fair value)
No single metric tells the full story. See the ELAN stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Elanco Animal Health is an animal health company that is engaged in developing, manufacturing, and marketing pharma products for companion and food animals. It spun off from Eli Lilly in 2018 and acquired Janssen Animal Health in 2011, Novartis Animal Health in 2014, Boehringer Ingelheim Vetmedica in 2017, and Bayer Animal Health in 2020. The company's operations are conducted globally, and it sells its products in over 90 countries. It offers a range of food animal products used in cattle, sheep, poultry, and swine production.
68GF Score
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