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.
Smith & Wesson Brands's Sloan Ratio for the quarter that ended in Apr. 2026 was -13.16%.
As of Apr. 2026, Smith & Wesson Brands has a Sloan Ratio of -13.16%, indicating there is a warning stage of accrual build up.
Smith & Wesson Brands (NAS:SWBI) 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 Apr. 2026, Smith & Wesson Brands has a Sloan Ratio of -13.16%, indicating there is a warning stage of accrual build up.
Smith & Wesson Brands Sloan Ratio % Related Terms
Smith & Wesson Brands Sloan Ratio % Historical Data
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The historical data trend for Smith & Wesson Brands'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 Aerospace & Defense subindustry, Smith & Wesson Brands'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.
Smith & Wesson Brands Sloan Ratio % vs Aerospace & Defense Industry
For the Aerospace & Defense industry and Industrials sector, Smith & Wesson Brands's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Smith & Wesson Brands'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.
Smith & Wesson Brands's Sloan Ratio for the fiscal year that ended in Apr. 2026 is calculated as
Smith & Wesson Brands's Net Income for the trailing twelve months (TTM) ended in Apr. 2026 was -3.411 (Jul. 2025 ) + 1.917 (Oct. 2025 ) + 3.753 (Jan. 2026 ) + 16.222 (Apr. 2026 ) = $18.5 Mil.
Smith & Wesson Brands's Cash Flow from Operations for the trailing twelve months (TTM) ended in Apr. 2026 was -8.11 (Jul. 2025 ) + 27.268 (Oct. 2025 ) + 20.456 (Jan. 2026 ) + 74.581 (Apr. 2026 ) = $114.2 Mil.
Smith & Wesson Brands's Cash Flow from Investing for the trailing twelve months (TTM) ended in Apr. 2026 was -7.464 (Jul. 2025 ) + -12.395 (Oct. 2025 ) + -3.615 (Jan. 2026 ) + -4.766 (Apr. 2026 ) = $-28.2 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.
Smith & Wesson Brands (SWBI) has a Sloan Ratio % of -13.16% as of Apr. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Smith & Wesson Brands and its competitors.
Is Smith & Wesson Brands' Sloan Ratio % too high?
Smith & Wesson Brands' current Sloan Ratio % is -13.16%. Overall, Smith & Wesson Brands has a GF Score™ of 57/100 and is considered Modestly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Smith & Wesson Brands' Sloan Ratio % compare to SATL and PKE?
Smith & Wesson Brands' Sloan Ratio % of -13.16% can be compared against companies in the Aerospace & Defense 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 Aerospace & Defense company?
A good Sloan Ratio % depends on the Aerospace & Defense 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 Smith & Wesson Brands and its competitors. Smith & Wesson Brands's current Sloan Ratio % is -13.16%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Smith & Wesson Brands stock overvalued right now?
Based on GuruFocus' analysis, Smith & Wesson Brands (SWBI) is currently considered Modestly Overvalued. The stock's GF Value™ is $13.85, compared to a current price of $15.60 — trading 12.6% above its estimated fair value. The current Sloan Ratio % is -13.16%. Smith & Wesson Brands' overall GF Score™ is 57/100 with 8 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 Smith & Wesson Brands (SWBI), the current Sloan Ratio % is -13.16% as of Apr. 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 Smith & Wesson Brands (SWBI) Overvalued in 2026?
Based on GuruFocus' analysis, Smith & Wesson Brands stock appears to be overvalued.
The current stock price of $15.60 is trading 12.6% above its estimated GF Value™ of $13.85.
GuruFocus considers Smith & Wesson Brands to be Modestly Overvalued.
Key valuation signals for SWBI:
Sloan Ratio %: -13.16%
GF Value™: $13.85 vs. price of $15.60 (12.6% above fair value)
No single metric tells the full story. See the SWBI stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Smith & Wesson Brands Inc is a U.S.-based company engaged in manufacturing and selling firearms. It operates under one reportable segment: Firearms, which includes firearms distribution and manufacturing services. The company manufactures handguns, long guns, sporting rifles, shooting gear, and suppressor products. The company sells its products under the Smith and Wesson and Gemtech brands, which are used for defense, law enforcement, hunting, and sporting purposes. Geographically, it sells products globally, with maximum income being generated by the U.S. market from its handgun products.
57GF Score
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