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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.
Companhia Deneamento Basico Do Estado Deo Paulo (NYSE:SBS) 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, Companhia Deneamento Basico Do Estado Deo Paulo has a Sloan Ratio of 23.30%, indicating there is a warning stage of accrual build up.
Companhia Deneamento Basico Do Estado Deo Paulo Sloan Ratio % Related Terms
Companhia Deneamento Basico Do Estado Deo Paulo 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.
Companhia Deneamento Basico Do Estado Deo Paulo Sloan Ratio % Chart
Companhia Deneamento Basico Do Estado Deo Paulo Annual Data
For the Utilities - Regulated Water subindustry, Companhia Deneamento Basico Do Estado Deo Paulo'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.
Companhia Deneamento Basico Do Estado Deo Paulo Sloan Ratio % vs Utilities - Regulated Industry
Companhia Deneamento Basico Do Estado Deo Paulo 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.
* 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.
Companhia Deneamento Basico Do Estado Deo Paulo (SBS) has a Sloan Ratio % of 23.30% as of Mar. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Companhia Deneamento Basico Do Estado Deo Paulo and its competitors.
Is Companhia Deneamento Basico Do Estado Deo Paulo's Sloan Ratio % too high?
Companhia Deneamento Basico Do Estado Deo Paulo's current Sloan Ratio % is 23.30%. Overall, Companhia Deneamento Basico Do Estado Deo Paulo has a GF Score™ of 85/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Companhia Deneamento Basico Do Estado Deo Paulo's Sloan Ratio % compare to AWK and WTRG?
Companhia Deneamento Basico Do Estado Deo Paulo's Sloan Ratio % of 23.30% can be compared against companies in the Utilities - Regulated 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 Utilities - Regulated company?
A good Sloan Ratio % depends on the Utilities - Regulated 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 Companhia Deneamento Basico Do Estado Deo Paulo and its competitors. Companhia Deneamento Basico Do Estado Deo Paulo's current Sloan Ratio % is 23.30%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Companhia Deneamento Basico Do Estado Deo Paulo stock overvalued right now?
Based on GuruFocus' analysis, Companhia Deneamento Basico Do Estado Deo Paulo (SBS) is currently considered Modestly Overvalued. The stock's GF Value™ is $4.59, compared to a current price of $5.31 — trading 15.7% above its estimated fair value. The current Sloan Ratio % is 23.30%. Companhia Deneamento Basico Do Estado Deo Paulo's overall GF Score™ is 85/100 with 6 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 Companhia Deneamento Basico Do Estado Deo Paulo (SBS), the current Sloan Ratio % is 23.30% 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 Companhia Deneamento Basico Do Estado Deo Paulo (SBS) Overvalued in 2026?
Based on GuruFocus' analysis, Companhia Deneamento Basico Do Estado Deo Paulo stock appears to be overvalued.
The current stock price of $5.31 is trading 15.7% above its estimated GF Value™ of $4.59.
GuruFocus considers Companhia Deneamento Basico Do Estado Deo Paulo to be Modestly Overvalued.
Key valuation signals for SBS:
Sloan Ratio %: 23.30%
GF Value™: $4.59 vs. price of $5.31 (15.7% above fair value)
No single metric tells the full story. See the SBS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Companhia De Saneamento Basico Do Estado De Sao Paulo is engaged in the provision of basic and environmental sanitation services in Sao Paulo State, and supplies treated water and sewage services on a wholesale basis. SABESP may perform activities in other states and countries and can operate in drainage, urban cleaning, solid waste handling, and energy markets. The company determined that it has a single operating segment, which is the provision of sanitation services.
85GF 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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