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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 May. 2026, Rocky Mountain Chocolate Factory has a Sloan Ratio of -10.63%, indicating there is a warning stage of accrual build up.
Rocky Mountain Chocolate Factory (NAS:RMCF) 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 May. 2026, Rocky Mountain Chocolate Factory has a Sloan Ratio of -10.63%, indicating there is a warning stage of accrual build up.
Rocky Mountain Chocolate Factory Sloan Ratio % Related Terms
Rocky Mountain Chocolate Factory 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.
Rocky Mountain Chocolate Factory Sloan Ratio % Chart
RMCF vs MTTCF, MGNC, PURE: Sloan Ratio % Comparison
For the Confectioners subindustry, Rocky Mountain Chocolate Factory'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.
Rocky Mountain Chocolate Factory Sloan Ratio % vs Consumer Packaged Goods Industry
For the Consumer Packaged Goods industry and Consumer Defensive sector, Rocky Mountain Chocolate Factory's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Rocky Mountain Chocolate Factory's Sloan Ratio % falls into.
Rocky Mountain Chocolate Factory 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.
Rocky Mountain Chocolate Factory's Net Income for the trailing twelve months (TTM) ended in May. 2026 was -0.662 (Aug. 2025 ) + -0.155 (Nov. 2025 ) + -3.419 (Feb. 2026 ) + -1.168 (May. 2026 ) = $-5.40 Mil.
Rocky Mountain Chocolate Factory's Cash Flow from Operations for the trailing twelve months (TTM) ended in May. 2026 was -0.488 (Aug. 2025 ) + -1.24 (Nov. 2025 ) + -0.432 (Feb. 2026 ) + -0.345 (May. 2026 ) = $-2.51 Mil.
Rocky Mountain Chocolate Factory's Cash Flow from Investing for the trailing twelve months (TTM) ended in May. 2026 was -0.188 (Aug. 2025 ) + -0.136 (Nov. 2025 ) + -0.263 (Feb. 2026 ) + -0.264 (May. 2026 ) = $-0.85 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.
Rocky Mountain Chocolate Factory (RMCF) has a Sloan Ratio % of -10.63% as of May. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Rocky Mountain Chocolate Factory and its competitors.
Is Rocky Mountain Chocolate Factory's Sloan Ratio % too high?
Rocky Mountain Chocolate Factory's current Sloan Ratio % is -10.63%. Overall, Rocky Mountain Chocolate Factory has a GF Score™ of 49/100 and is considered Possible Value Trap, reflecting its overall financial health beyond just this single metric.
How does Rocky Mountain Chocolate Factory's Sloan Ratio % compare to MTTCF and MGNC?
Rocky Mountain Chocolate Factory's Sloan Ratio % of -10.63% can be compared against companies in the Consumer Packaged Goods 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 Consumer Packaged Goods company?
A good Sloan Ratio % depends on the Consumer Packaged Goods 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 Rocky Mountain Chocolate Factory and its competitors. Rocky Mountain Chocolate Factory's current Sloan Ratio % is -10.63%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Rocky Mountain Chocolate Factory stock overvalued right now?
Based on GuruFocus' analysis, Rocky Mountain Chocolate Factory (RMCF) is currently considered Possible Value Trap. The stock's GF Value™ is $1.73, compared to a current price of $0.87 — trading 49.6% below its estimated fair value. The current Sloan Ratio % is -10.63%. Rocky Mountain Chocolate Factory's overall GF Score™ is 49/100 with 9 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 Rocky Mountain Chocolate Factory (RMCF), the current Sloan Ratio % is -10.63% as of May. 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 Rocky Mountain Chocolate Factory (RMCF) Overvalued in 2026?
Based on GuruFocus' analysis, Rocky Mountain Chocolate Factory stock appears to be undervalued.
The current stock price of $0.87 is trading 49.6% below its estimated GF Value™ of $1.73.
GuruFocus considers Rocky Mountain Chocolate Factory to be Possible Value Trap.
Key valuation signals for RMCF:
Sloan Ratio %: -10.63%
GF Value™: $1.73 vs. price of $0.87 (49.6% below fair value)
No single metric tells the full story. See the RMCF stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Rocky Mountain Chocolate Factory Business Description
Rocky Mountain Chocolate Factory Inc operates as a manufacturer of chocolate candies and confectionery products. The company prepares numerous products, including caramel apples in the store. The business activity of the firm functions through Franchising, Manufacturing, Retail Stores, and Others. The company derives maximum revenue through manufacturing activities. The products of the company include varieties of Clusters, Caramels, Creams, Toffees, Mints, and Truffles.
49GF Score
Get the complete analysis for RMCF
Sloan Ratio % is just one metric. See GF Value™, 30-year financials, guru trades, warning signs, and more.
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