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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.
Westinghouse Air Brake Technologies (NYSE:WAB) 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 Jun. 2026, Westinghouse Air Brake Technologies has a Sloan Ratio of 13.31%, indicating there is a warning stage of accrual build up.
Westinghouse Air Brake Technologies Sloan Ratio % Related Terms
Westinghouse Air Brake Technologies 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.
Westinghouse Air Brake Technologies Sloan Ratio % Chart
For the Railroads subindustry, Westinghouse Air Brake Technologies'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.
Westinghouse Air Brake Technologies Sloan Ratio % vs Transportation Industry
For the Transportation industry and Industrials sector, Westinghouse Air Brake Technologies's Sloan Ratio % distribution charts can be found below:
* The bar in red indicates where Westinghouse Air Brake Technologies's Sloan Ratio % falls into.
Westinghouse Air Brake Technologies 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.
Westinghouse Air Brake Technologies (WAB) has a Sloan Ratio % of 13.31% as of Jun. 2026. Sloan ratio measures earnings quality based on the amount of accruals. View historical data on Westinghouse Air Brake Technologies and its competitors.
Is Westinghouse Air Brake Technologies' Sloan Ratio % too high?
Westinghouse Air Brake Technologies' current Sloan Ratio % is 13.31%. Overall, Westinghouse Air Brake Technologies has a GF Score™ of 88/100 and is considered Significantly Overvalued, reflecting its overall financial health beyond just this single metric.
How does Westinghouse Air Brake Technologies' Sloan Ratio % compare to NSC and CSX?
Westinghouse Air Brake Technologies' Sloan Ratio % of 13.31% can be compared against companies in the Transportation 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 Transportation company?
A good Sloan Ratio % depends on the Transportation 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 Westinghouse Air Brake Technologies and its competitors. Westinghouse Air Brake Technologies's current Sloan Ratio % is 13.31%. However, context matters — high-growth companies often justify higher valuations. Always evaluate alongside other metrics like GF Score™ and GF Value™.
Is Westinghouse Air Brake Technologies stock overvalued right now?
Based on GuruFocus' analysis, Westinghouse Air Brake Technologies (WAB) is currently considered Significantly Overvalued. The stock's GF Value™ is $223.62, compared to a current price of $302.24 — trading 35.2% above its estimated fair value. The current Sloan Ratio % is 13.31%. Westinghouse Air Brake Technologies' overall GF Score™ is 88/100 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 Westinghouse Air Brake Technologies (WAB), the current Sloan Ratio % is 13.31% as of Jun. 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 Westinghouse Air Brake Technologies (WAB) Overvalued in 2026?
Based on GuruFocus' analysis, Westinghouse Air Brake Technologies stock appears to be overvalued.
The current stock price of $302.24 is trading 35.2% above its estimated GF Value™ of $223.62.
GuruFocus considers Westinghouse Air Brake Technologies to be Significantly Overvalued.
Key valuation signals for WAB:
Sloan Ratio %: 13.31%
GF Value™: $223.62 vs. price of $302.24 (35.2% above fair value)
No single metric tells the full story. See the WAB stock analysis page for a complete view including 30-year financials, guru trades, and insider activity.
Westinghouse Air Brake Technologies Business Description
Westinghouse Air Brake Technologies Corp provides value-added, technology-based products and services for the freight rail and passenger transit industries and the mining, marine, and industrial markets. It provides its products and services through two main business segments: Freight and Transit. The company generates maximum revenue from the Freight segment, which manufactures new and modernized locomotives, provides aftermarket parts and services to existing locomotives, provides components to new and existing freight cars; builds new commuter locomotives; supplies rail control and infrastructure products, including electronics, positive train control equipment, signal design, and engineering services. Geographically, it generates a majority of its revenue from the United States.
88GF 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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