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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.
Electronic Arts's Sloan Ratio for the quarter that ended in Mar. 2026 was -10.43%.
As of Mar. 2026, Electronic Arts has a Sloan Ratio of -10.43%, indicating there is a warning stage of accrual build up.
Electronic Arts (FRA:ERT) 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 Mar. 2026, Electronic Arts has a Sloan Ratio of -10.43%, indicating there is a warning stage of accrual build up.
Electronic Arts Sloan Ratio % Related Terms
Electronic Arts Sloan Ratio % Historical Data
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The historical data trend for Electronic Arts'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.
FRA:ERT vs TTWO, RBLX, NTES: Sloan Ratio % Comparison
For the Electronic Gaming & Multimedia subindustry, Electronic Arts'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.
Electronic Arts Sloan Ratio % vs Interactive Media Industry
For the Interactive Media industry and Communication Services sector, Electronic Arts's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Electronic Arts'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.
Electronic Arts's Sloan Ratio for the fiscal year that ended in Mar. 2026 is calculated as
Electronic Arts's Net Income for the trailing twelve months (TTM) ended in Mar. 2026 was 174.267 (Jun. 2025 ) + 116.724 (Sep. 2025 ) + 75.152 (Dec. 2025 ) + 398.765 (Mar. 2026 ) = €765 Mil.
Electronic Arts's Cash Flow from Operations for the trailing twelve months (TTM) ended in Mar. 2026 was 14.739 (Jun. 2025 ) + 110.76 (Sep. 2025 ) + 1559.404 (Dec. 2025 ) + 501.7 (Mar. 2026 ) = €2,187 Mil.
Electronic Arts's Cash Flow from Investing for the trailing twelve months (TTM) ended in Mar. 2026 was -77.163 (Jun. 2025 ) + -57.936 (Sep. 2025 ) + -48.678 (Dec. 2025 ) + -53.63 (Mar. 2026 ) = €-237 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.
Electronic Arts (FRA:ERT) has a Sloan Ratio % of -10.43% as of Mar. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Electronic Arts and its competitors.
Is Electronic Arts' Sloan Ratio % too high?
Electronic Arts' current Sloan Ratio % is -10.43%. Overall, Electronic Arts has a GF Score™ of 90/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Electronic Arts' Sloan Ratio % compare to TTWO and RBLX?
Electronic Arts' Sloan Ratio % of -10.43% can be compared against companies in the Interactive Media 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 Interactive Media company?
A good Sloan Ratio % depends on the Interactive Media 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 Electronic Arts and its competitors. Electronic Arts's current Sloan Ratio % is -10.43%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Electronic Arts stock overvalued right now?
Based on GuruFocus' analysis, Electronic Arts (FRA:ERT) is currently considered Modestly Overvalued. The stock's GF Value™ is €139.01, compared to a current price of €181.00 — trading 30.2% above its estimated fair value. The current Sloan Ratio % is -10.43%. Electronic Arts' overall GF Score™ is 90/100 with 5 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 Electronic Arts (FRA:ERT), the current Sloan Ratio % is -10.43% as of Mar. 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 Electronic Arts (FRA:ERT) Overvalued in 2026?
Based on GuruFocus' analysis, Electronic Arts stock appears to be overvalued.
The current stock price of €181.00 is trading 30.2% above its estimated GF Value™ of €139.01.
GuruFocus considers Electronic Arts to be Modestly Overvalued.
Key valuation signals for FRA:ERT:
Sloan Ratio %: -10.43%
GF Value™: €139.01 vs. price of €181.00 (30.2% above fair value)
No single metric tells the full story. See the FRA:ERT stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Electronic Arts is one of the largest global developers and publishers of video games. Its most important franchises are the Madden NFL and FC soccer games, which it releases annually. In 2024, it also relaunched its American college football game. Other major franchises include Apex Legends, Battlefield, and The Sims. Typically, about three-quarters of the firm's sales are from in-game spending, with the remainder coming from initial game sales.
90GF Score
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Sloan Ratio % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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