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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.
Surge Components's Sloan Ratio for the quarter that ended in May. 2026 was 0.51%.
As of May. 2026, Surge Components has a Sloan Ratio of 0.51%, indicating the company is in the safe zone and there is no funny business with accruals.
Surge Components (OTCPK:SPRS) 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, Surge Components has a Sloan Ratio of 0.51%, indicating the company is in the safe zone and there is no funny business with accruals.
Surge Components Sloan Ratio % Related Terms
Surge Components Sloan Ratio % Historical Data
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The historical data trend for Surge Components'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 Electronics & Computer Distribution subindustry, Surge Components'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.
Surge Components Sloan Ratio % vs Hardware Industry
For the Hardware industry and Technology sector, Surge Components's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Surge Components'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.
Surge Components's Sloan Ratio for the fiscal year that ended in Nov. 2025 is calculated as
Surge Components's Net Income for the trailing twelve months (TTM) ended in May. 2026 was 0.472 (Aug. 2025 ) + 0.489 (Nov. 2025 ) + -0.034 (Feb. 2026 ) + 0.405 (May. 2026 ) = $1.33 Mil.
Surge Components's Cash Flow from Operations for the trailing twelve months (TTM) ended in May. 2026 was 0.099 (Aug. 2025 ) + 0.731 (Nov. 2025 ) + 1.091 (Feb. 2026 ) + 0.286 (May. 2026 ) = $2.21 Mil.
Surge Components's Cash Flow from Investing for the trailing twelve months (TTM) ended in May. 2026 was 0.236 (Aug. 2025 ) + 0.219 (Nov. 2025 ) + 0.027 (Feb. 2026 ) + -1.503 (May. 2026 ) = $-1.02 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.
Surge Components (SPRS) has a Sloan Ratio % of 0.51% as of May. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Surge Components and its competitors.
Is Surge Components' Sloan Ratio % too high?
Surge Components' current Sloan Ratio % is 0.51%. Overall, Surge Components has a GF Score™ of 56/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Surge Components' Sloan Ratio % compare to TAIT and IZM?
Surge Components' Sloan Ratio % of 0.51% can be compared against companies in the Hardware 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 Hardware company?
A good Sloan Ratio % depends on the Hardware 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 Surge Components and its competitors. Surge Components's current Sloan Ratio % is 0.51%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Surge Components stock overvalued right now?
Based on GuruFocus' analysis, Surge Components (SPRS) is currently considered Significantly Overvalued. The stock's GF Value™ is $2.74, compared to a current price of $3.98 — trading 45.1% above its estimated fair value. The current Sloan Ratio % is 0.51%. Surge Components' overall GF Score™ is 56/100 with 5 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 Surge Components (SPRS), the current Sloan Ratio % is 0.51% 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 Surge Components (SPRS) Overvalued in 2026?
Based on GuruFocus' analysis, Surge Components stock appears to be overvalued.
The current stock price of $3.98 is trading 45.1% above its estimated GF Value™ of $2.74.
GuruFocus considers Surge Components to be Significantly Overvalued.
Key valuation signals for SPRS:
Sloan Ratio %: 0.51%
GF Value™: $2.74 vs. price of $3.98 (45.1% above fair value)
No single metric tells the full story. See the SPRS stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Surge Components Inc is a supplier of electronic products and components. The company's products include capacitors, which are electrical energy storage devices, and discrete components, such as rectifiers, switches, transistors, voltage suppressors, and diodes. Its marketed products are utilized in the electronic circuitry of products, comprising of automobiles, telecom, audio, cellular telephones, computers, consumer electronics, garage door openers, household appliances, power supplies, and security equipment. In addition, the company's products are also sold to original equipment manufacturers and distributors.
56GF Score
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