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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.
Sherwin-Williams Co's Sloan Ratio for the quarter that ended in Mar. 2026 was 3.29%.
As of Mar. 2026, Sherwin-Williams Co has a Sloan Ratio of 3.29%, indicating the company is in the safe zone and there is no funny business with accruals.
Sherwin-Williams Co (NYSE:SHW) 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, Sherwin-Williams Co has a Sloan Ratio of 3.29%, indicating the company is in the safe zone and there is no funny business with accruals.
Sherwin-Williams Co Sloan Ratio % Related Terms
Sherwin-Williams Co Sloan Ratio % Historical Data
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The historical data trend for Sherwin-Williams Co'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, Sherwin-Williams Co'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.
Sherwin-Williams Co Sloan Ratio % vs Chemicals Industry
For the Chemicals industry and Basic Materials sector, Sherwin-Williams Co's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Sherwin-Williams Co'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.
Sherwin-Williams Co's Sloan Ratio for the fiscal year that ended in Dec. 2025 is calculated as
Sherwin-Williams Co's Net Income for the trailing twelve months (TTM) ended in Mar. 2026 was 754.7 (Jun. 2025 ) + 833.1 (Sep. 2025 ) + 476.8 (Dec. 2025 ) + 534.7 (Mar. 2026 ) = $2,599 Mil.
Sherwin-Williams Co's Cash Flow from Operations for the trailing twelve months (TTM) ended in Mar. 2026 was 1112.6 (Jun. 2025 ) + 1307.6 (Sep. 2025 ) + 1092.5 (Dec. 2025 ) + 139.1 (Mar. 2026 ) = $3,652 Mil.
Sherwin-Williams Co's Cash Flow from Investing for the trailing twelve months (TTM) ended in Mar. 2026 was -241.1 (Jun. 2025 ) + -1337.4 (Sep. 2025 ) + -171.6 (Dec. 2025 ) + -170.5 (Mar. 2026 ) = $-1,921 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.
Sherwin-Williams Co (SHW) has a Sloan Ratio % of 3.29% as of Mar. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Sherwin-Williams Co and its competitors.
Is Sherwin-Williams Co's Sloan Ratio % too high?
Sherwin-Williams Co's current Sloan Ratio % is 3.29%. Overall, Sherwin-Williams Co has a GF Score™ of 89/100 and is considered Fairly Valued, reflecting its overall financial health beyond just this single metric.
How does Sherwin-Williams Co's Sloan Ratio % compare to ECL and APD?
Sherwin-Williams Co's Sloan Ratio % of 3.29% 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 Sherwin-Williams Co and its competitors. Sherwin-Williams Co's current Sloan Ratio % is 3.29%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Sherwin-Williams Co stock overvalued right now?
Based on GuruFocus' analysis, Sherwin-Williams Co (SHW) is currently considered Fairly Valued. The stock's GF Value™ is $356.49, compared to a current price of $327.27 — trading 8.2% below its estimated fair value. The current Sloan Ratio % is 3.29%. Sherwin-Williams Co's overall GF Score™ is 89/100. 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 Sherwin-Williams Co (SHW), the current Sloan Ratio % is 3.29% 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 Sherwin-Williams Co (SHW) Overvalued in 2026?
Based on GuruFocus' analysis, Sherwin-Williams Co stock appears to be undervalued.
The current stock price of $327.27 is trading 8.2% below its estimated GF Value™ of $356.49.
GuruFocus considers Sherwin-Williams Co to be Fairly Valued.
Key valuation signals for SHW:
Sloan Ratio %: 3.29%
GF Value™: $356.49 vs. price of $327.27 (8.2% below fair value)
No single metric tells the full story. See the SHW stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Sherwin-Williams is the largest global manufacturer of paints and coatings. The company focuses on the development, manufacturing, and distribution of paint, coatings, and related products to customers ranging from professional painters and contractors to industrial manufacturers to do-it-yourself consumers. Sherwin organizes its operations into three primary segments: the paint stores group is the largest segment and includes the company's network of over 4,800 company-owned stores; the consumer brands group sells branded architectural paints through big-box retailers such as Lowe's, and the performance coatings group provides specialized coatings for industrial applications, such as automotive refinishing, packaging, and industrial wood.
89GF Score
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