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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.
Element Solutions's Sloan Ratio for the quarter that ended in Jun. 2026 was 15.73%.
As of Jun. 2026, Element Solutions has a Sloan Ratio of 15.73%, indicating there is a warning stage of accrual build up.
Element Solutions (NYSE:ESI) 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, Element Solutions has a Sloan Ratio of 15.73%, indicating there is a warning stage of accrual build up.
Element Solutions Sloan Ratio % Related Terms
Element Solutions Sloan Ratio % Historical Data
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The historical data trend for Element Solutions'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 Specialty Chemicals subindustry, Element Solutions'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.
Element Solutions Sloan Ratio % vs Chemicals Industry
For the Chemicals industry and Basic Materials sector, Element Solutions's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Element Solutions'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.
Element Solutions's Sloan Ratio for the fiscal year that ended in Dec. 2025 is calculated as
Element Solutions's Net Income for the trailing twelve months (TTM) ended in Jun. 2026 was 39.3 (Sep. 2025 ) + 6.1 (Dec. 2025 ) + 55.9 (Mar. 2026 ) + 77.3 (Jun. 2026 ) = $179 Mil.
Element Solutions's Cash Flow from Operations for the trailing twelve months (TTM) ended in Jun. 2026 was 100.1 (Sep. 2025 ) + 91.1 (Dec. 2025 ) + -66.6 (Mar. 2026 ) + 99.6 (Jun. 2026 ) = $224 Mil.
Element Solutions's Cash Flow from Investing for the trailing twelve months (TTM) ended in Jun. 2026 was -18.2 (Sep. 2025 ) + -18.8 (Dec. 2025 ) + -889.3 (Mar. 2026 ) + -29.4 (Jun. 2026 ) = $-956 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.
Element Solutions (ESI) has a Sloan Ratio % of 15.73% as of Jun. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Element Solutions and its competitors.
Is Element Solutions' Sloan Ratio % too high?
Element Solutions' current Sloan Ratio % is 15.73%. Overall, Element Solutions has a GF Score™ of 82/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Element Solutions' Sloan Ratio % compare to WLK and SOLS?
Element Solutions' Sloan Ratio % of 15.73% can be compared against companies in the Chemicals 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 Chemicals company?
A good Sloan Ratio % depends on the Chemicals 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 Element Solutions and its competitors. Element Solutions's current Sloan Ratio % is 15.73%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Element Solutions stock overvalued right now?
Based on GuruFocus' analysis, Element Solutions (ESI) is currently considered Fairly Valued. The stock's GF Value™ is $33.82, compared to a current price of $35.62 — trading 5.3% above its estimated fair value. The current Sloan Ratio % is 15.73%. Element Solutions' overall GF Score™ is 82/100 with 2 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 Element Solutions (ESI), the current Sloan Ratio % is 15.73% 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 Element Solutions (ESI) Overvalued in 2026?
Based on GuruFocus' analysis, Element Solutions stock appears to be overvalued.
The current stock price of $35.62 is trading 5.3% above its estimated GF Value™ of $33.82.
GuruFocus considers Element Solutions to be Fairly Valued.
Key valuation signals for ESI:
Sloan Ratio %: 15.73%
GF Value™: $33.82 vs. price of $35.62 (5.3% above fair value)
No single metric tells the full story. See the ESI stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Element Solutions Inc is a specialty chemicals company whose businesses supply a broad range of solutions that enhance the performance of products people use every day. The company's reportable segments are Electronics and Industrial & Specialty. The Electronics segment, which generates maximum revenue, researches, formulates, and sells specialty chemicals and process technologies for all types of electronics hardware, from complex printed circuit board designs to semiconductor packaging. This segment's wet chemicals for metallization, surface treatments, and solderable finishes form the physical circuitry pathways, and its assembly materials, such as solder, pastes, fluxes, and adhesives, join those pathways together.
82GF Score
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