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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 Dec. 2019, Puradyn Filter Technologies has a Sloan Ratio of 0.00%, indicating the company is in the safe zone and there is no funny business with accruals.
Puradyn Filter Technologies (OTCPK:PFTI) 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 Dec. 2019, Puradyn Filter Technologies has a Sloan Ratio of 0.00%, indicating the company is in the safe zone and there is no funny business with accruals.
Puradyn Filter Technologies Sloan Ratio % Related Terms
Puradyn Filter Technologies 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.
PFTI vs CSHEF, FLES, OMTK: Sloan Ratio % Comparison
For the Auto Parts subindustry, Puradyn Filter Technologies'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.
Puradyn Filter Technologies Sloan Ratio % vs Vehicles & Parts Industry
For the Vehicles & Parts industry and Consumer Cyclical sector, Puradyn Filter Technologies's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Puradyn Filter Technologies's Sloan Ratio % falls into.
Puradyn Filter Technologies 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.
Puradyn Filter Technologies's Net Income for the trailing twelve months (TTM) ended in Dec. 2019 was -0.367 (Mar. 2019 ) + -0.362 (Jun. 2019 ) + -0.432 (Sep. 2019 ) + -0.526 (Dec. 2019 ) = $-1.69 Mil.
Puradyn Filter Technologies's Cash Flow from Operations for the trailing twelve months (TTM) ended in Dec. 2019 was -0.229 (Mar. 2019 ) + -0.28 (Jun. 2019 ) + -0.204 (Sep. 2019 ) + -0.233 (Dec. 2019 ) = $-0.95 Mil.
Puradyn Filter Technologies's Cash Flow from Investing for the trailing twelve months (TTM) ended in Dec. 2019 was -0.008 (Mar. 2019 ) + 0 (Jun. 2019 ) + -0.002 (Sep. 2019 ) + -0.002 (Dec. 2019 ) = $-0.01 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.
Puradyn Filter Technologies (PFTI) has a Sloan Ratio % of 0.00% as of Dec. 2019. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Puradyn Filter Technologies and its competitors.
Is Puradyn Filter Technologies' Sloan Ratio % too high?
Puradyn Filter Technologies' current Sloan Ratio % is 0.00%. Overall, Puradyn Filter Technologies has a GF Score™ of 12/100, reflecting its overall financial health beyond just this single metric.
How does Puradyn Filter Technologies' Sloan Ratio % compare to CSHEF and FLES?
Puradyn Filter Technologies' Sloan Ratio % of 0.00% can be compared against companies in the Vehicles & Parts 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 Vehicles & Parts company?
A good Sloan Ratio % depends on the Vehicles & Parts 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 Puradyn Filter Technologies and its competitors. Puradyn Filter Technologies'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 Puradyn Filter Technologies stock overvalued right now?
Puradyn Filter Technologies (PFTI) has a current Sloan Ratio % of 0.00%. The current Sloan Ratio % is 0.00%. Puradyn Filter Technologies' overall GF Score™ is 12/100. 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 Puradyn Filter Technologies (PFTI), the current Sloan Ratio % is 0.00% as of Dec. 2019. 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.
Puradyn Filter Technologies Inc is involved in designing manufacturing and distributing Puradyn oil filtration system. Its product is used for all combustion engines and hydraulic equipment that use lubricating oil. The filtration system primarily cleans oil by providing a second circuit of oil filtration and provides treatment to continually remove solid, liquid, and gaseous contaminants from the oil through the filtration and evaporation process. The filtration system is offered in two models namely MTS and a custom engineered hydraulic system. The company markets its product and generates revenue from across the globe.
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