Time Warner Cable (Time Warner Cable) Predictability Rank

View and export this data going back to . Start your Free Trial

What is Time Warner Cable Predictability Rank?

Not Rated

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.

Time Warner Cable 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

Time Warner Cable Predictability Rank Related Terms

Thank you for viewing the detailed overview of Time Warner Cable's Predictability Rank provided by GuruFocus.com. Please click on the following links to see related term pages.

Time Warner Cable (Time Warner Cable) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Communication Services » Media - Diversified » Time Warner Cable Inc (NYSE:TWC) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

N/A

Address

Website

http://www.timewarnercable.com

Time Warner Cable Inc was incorporated as a Delaware corporation on March 21, 2003. The Company provides video, high-speed data and voice services in five geographic areas: New York State, the Carolinas, the Midwest, Southern California and Texas. The Company has three reportable segments: Residential Services, Business Services and Other Operations. Its video service provides over 300 channels and 20,000 video-on-demand choices. It offers tiers and packages of video programming and music services. Its residential video subscribers also may subscribe to premium network programming, such as Cinemax, EPIX, HBO, Showtime and Starz. The Company offers high-speed data service tiers, each with attributes tailored to meet the different needs its subscribers providing from up to 2 to up to 300 mbps downstream levels. Its high-speed data service also provides communication tools and personalized services, including email, PC security, parental controls and online radio, at no additional charge. The Company offers IntelligentHome, a security and home management service, in substantially all of its operating areas. It offers networking, voice, video, hosting and cloud computing services. The Company offers business customers a data services, including Internet access, network services and wholesale transport services. It also offers video programming tiers, music services and voice services including multi-line phone service and trunk service. The Company's Other Operations segment consists of Time Warner Cable Media, the advertising sales arm, its local sports, news and lifestyle channels and SportsNet LA. The Company delivers video, data and voice services over a network that includes a nationwide fiber backbone, fiber-rich regional and metro rings, and last mile connections to customers' homes and businesses. It contracts with third parties for goods and services related to the delivery of its video, high-speed data and voice services. The Company's residential video, high-speed data and voice services face competition from AT&T, CenturyLink, Inc., Cincinnati Bell Inc, Fairpoint Communications Inc, Frontier Communications Corp, Hawaiian Telcom Holdco Inc, Verizon and Windstream Corp. Its residential video and high-speed data services compete with Google's video and broadband services.

Executives

Donna James	director	ONE MIRANOVA PLACE, SUITE 1040, COLUMBUS OH 43215
John E Sununu	director	C/O BOSTON SCIENTIFIC CORPORATION, 300 BOSTON SCIENTIFIC WAY, MARLBOROUGH MA 01752
Copeland James E Jr	director	2500 WINDY RIDGE PARKWAY, ATLANTA GA 30339
Robert D Marcus	director, officer: Chairman & CEO	C/O TIME WARNER CABLE INC., 60 COLUMBUS CIRCLE, 17TH FLOOR, NEW YORK NY 10023
Nicholas Nicholas J Jr	director	C/O TIME WARNER CABLE INC., 60 COLUMBUS CIRCLE, 16TH FLOOR, NEW YORK NY 10023
Thomas H Castro	director	C/O TIME WARNER CABLE INC., 60 COLUMBUS CIRCLE, 16TH FLOOR, NEW YORK NY 10023
Osbourn William F Jr	officer: SVP, Chief Acct Off & Co-CFO	C/O TIME WARNER CABLE, 60 COLUMBUS CIRCLE, 16TH FLOOR, NEW YORK NY 10023
Matthew Siegel	officer: SVP & Treasurer and Co-CFO	C/O TIME WARNER CABLE, 60 COLUMBUS CIRCLE, NEW YORK NY 10023
Edward D Shirley	director	SYSCO CORPORATION, 1390 ENCLAVE PARKWAY, HOUSTON TX 77077
Carole Black	director	C/O TIME WARNER CABLE INC., 60 COLUMBUS CIRCLE, 16TH FLOOR, NEW YORK NY 10023
David C Chang	director	C/O TIME WARNER CABLE INC., 60 COLUMBUS CIRCLE, 16TH FLOOR, NEW YORK NY 10023
Glenn Britt	director	C/O TIME WARNER CABLE INC., 60 COLUMBUS CIRCLE, 17TH FLOOR, NEW YORK NY 10023
Melinda Witmer	officer: EVP, Chf Video & Content Offcr	C/O TEGNA INC., 7950 JONES BRANCH DRIVE, MCLEAN VA 22107
Joan H Gillman	officer: EVP & COO, Media Services	C/O AIRGAIN, INC., 3611 VALLEY CENTRE DRIVE, SUITE 150, SAN DIEGO CA 92130
Irene M Esteves	officer: EVP & CFO	C/O TIME WARNER CABLE INC., 60 COLUMBUS CIRCLE, 17TH FLOOR, NEW YORK NY 10023