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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.
Formation Minerals's Sloan Ratio for the quarter that ended in Jan. 2025 was 0.00%.
As of Jan. 2025, Formation Minerals has a Sloan Ratio of 0.00%, indicating the company is in the safe zone and there is no funny business with accruals.
Formation Minerals (OTCPK:FOMI) 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 Jan. 2025, Formation Minerals has a Sloan Ratio of 0.00%, indicating the company is in the safe zone and there is no funny business with accruals.
Formation Minerals Sloan Ratio % Related Terms
Formation Minerals Sloan Ratio % Historical Data
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The historical data trend for Formation Minerals'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.
For the Oil & Gas E&P subindustry, Formation Minerals'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.
Formation Minerals Sloan Ratio % vs Oil & Gas Industry
For the Oil & Gas industry and Energy sector, Formation Minerals's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Formation Minerals'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.
Formation Minerals's Sloan Ratio for the fiscal year that ended in Apr. 2024 is calculated as
Formation Minerals's Net Income for the trailing twelve months (TTM) ended in Jan. 2025 was 0.464 (Apr. 2024 ) + 0.289 (Jul. 2024 ) + -1.017 (Oct. 2024 ) + -0.967 (Jan. 2025 ) = $-1.23 Mil.
Formation Minerals's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jan. 2025 was 0.736 (Apr. 2024 ) + -0.289 (Jul. 2024 ) + -0.217 (Oct. 2024 ) + -0.098 (Jan. 2025 ) = $0.13 Mil.
Formation Minerals's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jan. 2025 was -0.507 (Apr. 2024 ) + 0.14 (Jul. 2024 ) + 0 (Oct. 2024 ) + 0 (Jan. 2025 ) = $-0.37 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.
Formation Minerals (FOMI) has a Sloan Ratio % of 0.00% as of Jan. 2025. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Formation Minerals and its competitors.
Is Formation Minerals' Sloan Ratio % too high?
Formation Minerals' current Sloan Ratio % is 0.00%.
How does Formation Minerals' Sloan Ratio % compare to AVACF and COP?
Formation Minerals' Sloan Ratio % of 0.00% can be compared against companies in the Oil & Gas 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 Oil & Gas company?
A good Sloan Ratio % depends on the Oil & Gas 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 Formation Minerals and its competitors. Formation Minerals's current Sloan Ratio % is 0.00%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Formation Minerals stock overvalued right now?
Formation Minerals (FOMI) has a current Sloan Ratio % of 0.00%. The current Sloan Ratio % is 0.00%. 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 Formation Minerals (FOMI), the current Sloan Ratio % is 0.00% as of Jan. 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.
Formation Minerals Inc is engaged in the acquisition and management of high-growth oil and gas minerals and royalties in the U.S. basins. The company is focused on providing returns through asset growth generated by acquisitions and organic growth of properties. Its portfolio includes the DJ Basin of Colorado and Wyoming, the Haynesville Shale of Louisiana, the Delaware and Permian Basin of Texas, the Marcellus and Utica shales in West Virginia, and the Anadarko Basin in Oklahoma.
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