What is Ocular Therapeutix Predictability Rank?
1 (5)
Warren Buffett said many times that the companies he likes are:
1. Simple businesses that he understands
2. that have predictable and proven earnings and
3. with economic moat
4. those can be bought at a reasonable price.
It is hard to quantify "simple businesses that he (Buffett) understands", so we will focus on the other three characteristics instead. In GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank, we will show that the businesses that have predictable and proven earnings are usually also simple businesses that an average person could understand.
GuruFocus conducted a back test study of Warren Buffett's strategy of "buying good companies at fair prices" for the years from 1998-2008.
Ocular Therapeutix Predictability Rank Calculation
In our database there are 2403 stocks that have been traded from Jan. 2, 1998 to Aug. 31, 2008. We have the complete 10-year financial data and trading prices of these companies for this period. We rank the predictability of these companies based on the consistency of their revenue per share and EBITDA (earning before interest, tax, depreciation and amortization) per share over the past ten fiscal years, and study the correlation between the stock performances and the predictability of the business.
Our study may be subject to these biases and assumptions:
Dividend yields are not counted for investment returns
Effects of price changes due to spin-offs may not be fully adjusted
Study is subjected to survivorship bias due to de-listing, bankruptcy, LBO, M&A, etc.
The correlation between business predictability and investment returns of a company is showed below.
Correlation Between Business Predictability and Investment Returns
| Predictables | Non-Predictable | All stocks |
|---|
| Total Number of stocks | 570 | 1833 | 2403 |
| Total Lost Money | 61 | 830 | 891 |
| Total Lost More Than 50% | 18 | 412 | 430 |
| Total Lost More Than 90% | 4 | 86 | 90 |
| Average Gain | 260.6% | 100.0% | 138.1% |
| Median Gain | 150.0% | 13.0% | 39.0% |
| Maximum Gain | 2852.0% | 11483.0% | 11483.0% |
| Maximum Loss | -100.0% | -100.0% | -100.0% |
| Annualized Average Gain | 12.7% | 6.7% | 8.4% |
| Annualized Median Gain | 8.9% | 1.1% | 3.1% |
For the 570 predictable companies, we have seen strong correlation between the predictability of businesses and the stock performances over the past 10 years, regardless of the valuation of business at 1998. Accordingly, we have ranked the business predictability from 5-star to 1-star, as shown in this table.
| Predictability Rank | 5-Star | 4.5-Star | 4-Star | 3.5-Star | 3-Star | 2.5-Star | 2-Star | 1-Star (non-predictable) | Average among all |
|---|
| % Out of All 2403 Stocks |
3.3% |
2.9% |
3.7% |
3.3% |
3.3% |
3.7% |
3.3% |
76.3% |
100% |
| % that are in Loss (10y) |
3% |
10% |
8% |
9% |
11% |
18% |
16% |
45% |
37% |
| Average Gain (10y) |
364.6% |
330.9% |
278.0% |
235.1% |
243.5% |
227.8% |
154.8% |
100.0% |
138.1% |
| Median Gain (10y) |
238.5% |
193.5% |
171.0% |
159.0% |
132.5% |
113.5% |
87.0% |
13.0% |
39.0% |
| Maximum Gainer |
2228.0% |
2547.0% |
2452.0% |
2852.0% |
2432.0% |
1892.0% |
1807.0% |
11483.0% |
11483.0% |
| Maximum Loser |
-82.0% |
-53.0% |
-67.0% |
-100.0% |
-83.0% |
-100.0% |
-78.0% |
-100.0% |
-100.0% |
| Annualized Average Gain |
15.4% |
14.6% |
13.2% |
12.0% |
12.2% |
11.7% |
9.1% |
6.7% |
8.4% |
| Annualized Median Gain |
12.1% |
10.6% |
9.8% |
9.3% |
8.2% |
7.3% |
6.0% |
1.1% |
3.1% |
For detailed information about each predictability rank, please go to GuruFocus Research: What worked in the market from 1998-2008? Part I: Introduction of Predictability Rank
Also read:
Part II: What worked in the market from 1998-2008? Part II: Role of Valuations
Part III: Intrinsic Value, Discounted Cash Flow and Margin of Safety
Ocular Therapeutix (Ocular Therapeutix) Business Description
Traded in Other Exchanges
Address
24 Crosby Drive, Bedford, MA, USA, 01730
Ocular Therapeutix Inc is a biotechnology company that specializes in therapies for diseases and conditions of the eye. The company uses its proprietary hydrogel platform technology to deliver therapeutic agents to the eye. Its pipeline consists of eye medication that aims to overcome the limitations of current eye-drop-based therapies for ophthalmic diseases and conditions. Ocular Therapeutix aims to offer medication to replace the existing eye-drop therapy regimen, with the aim of lasting weeks or months with a one-time product application. Its pipeline product includes Dextenza, OTX-TIC, OTX-TKI, and OTX-IVT.
Executives
| Summer Road Llc |
10 percent owner |
207 6TH STREET, WEST PALM BEACH FL 33401 |
| Antony C. Mattessich |
director |
C/O OCULAR THERAPEUTIX, INC., 34 CROSBY DR., SUITE 105, BEDFORD MA 01730 |
| Adrienne L Graves |
director |
125 STONE MOUNTAIN CIRCLE, NAPA CA 94558 |
| Rabia Gurses Ozden |
officer: Chief Medical Officer |
C/O AKOUOS, INC., 645 SUMMER STREET SUITE 200, BOSTON MA 02210 |
| Philip C. Strassburger |
officer: General Counsel |
24 CROSBY DRIVE, BEDFORD MA 01730 |
| Donald Notman |
officer: Chief Financial Officer |
C/O OCULAR THERAPEUTIX, INC., 15 CROSBY DRIVE, BEDFORD MA 01730 |
| Christopher G White |
officer: Chief Business Officer |
C/O AMAG PHARMACEUTICALS, INC., 1100 WINTER STREET, WALTHAM MA 02451 |
| Jeffrey S. Heier |
director |
C/O OCULAR THERAPEUTIX, INC., 34 CROSBY DR., SUITE 105, BEDFORD MA 01730 |
| Merilee Raines |
director |
IDEXX LABORATORIES, INC., ONE IDEXX DRIVE, WESTBROOK ME 04092 |
| Lindstrom Richard L Md |
director |
2811 WESTWOOD PL, WAYZATA MN 55391 |
| Opaleye Management Inc. |
10 percent owner |
ONE BOSTON PLACE, SUITE 2600, BOSTON MA 02108 |
| Patricia Kitchen |
officer: Chief Operations Officer |
C/O OCULAR THERAPEUTIX, INC., 15 CROSBY DRIVE, BEDFORD MA 01730 |
| Leslie J. Williams |
director |
C/O OCULAR THERAPEUTIX, INC., 15 CROSBY DRIVE, BEDFORD MA 01730 |
| Seung Suh Hong |
director |
C/O OCULAR THERAPEUTIX, INC., 15 CROSBY DRIVE, BEDFORD MA 01730 |
| Amarpreet Sawhney |
director, 10 percent owner, officer: President and CEO |
C/O OCULAR THERAPEUTIX, INC., 36 CROSBY DRIVE, SUITE 101, BEDFORD MA 01730 |
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