Intermolecular (Intermolecular) Predictability Rank

View and export this data going back to 2011. Start your Free Trial

What is Intermolecular 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.

Intermolecular 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

Intermolecular Predictability Rank Related Terms

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

Intermolecular (Intermolecular) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Semiconductors » Intermolecular Inc (NAS:IMI) » Definitions » Predictability Rank

Traded in Other Exchanges

N/A

Address

3011 North First Street, San Jose, CA, USA, 95134

Website

http://www.intermolecular.com

Intermolecular Inc operates in the technology sector based in the United States. It manufactures and sells support materials for the semiconductor industry. Its HPC platform, which consists of the Tempus processing tools, automated characterization methods and Informatics analysis software, is purpose-built for research and development ("R&D") using combinatorial process systems in concert with established CVD, physical vapor deposition ("PVD") and atomic layer deposition ("ALD") deposition methods. It caters to semiconductor device, semiconductor materials and equipment and clean energy market companies primarily in the Asia-Pacific region.

Executives

Raging Capital Management, Llc	10 percent owner	TEN PRINCETON AVENUE, PO BOX 228, ROCKY HILL NJ 08553-0228
Christian Kramer	director, officer: President and CEO	6 DAVIS AVE APT B22, RYE NY 10580
Irwin Federman	10 percent owner	2735 SAND HILL ROAD, MENLO PARK CA 94025
Kenneth H Traub	director
William C Martin	10 percent owner	C/O RAGING CAPITAL MANAGEMENT, LLC, TEN PRINCETON AVENUE, PO BOX 228, ROCKY HILL NJ 08553
Bill Roeschlein	officer: Chief Financial Officer	C/O SELECTICA, INC., 3 WEST PLUMERIA, SAN JOSE CA 95134
George Scalise	director
Marvin D Burkett	director	C/O ENTEGRIS, INC., 129 CONCORD ROAD, BILLERICA MA 01821
Redpoint Ventures Ii, L.p.	10 percent owner	3000 SAND HILL ROAD, BUILDING 2, SUITE 290, MENLO PARK CA 94025
Redpoint Associates Ii, Llc	10 percent owner	3000 SAND HILL ROAD, BUILDING 2, SUITE 290, MENLO PARK CA 94025
Redpoint Ventures Ii, Llc	10 percent owner	3000 SAND HILL ROAD, BUILDING 2, SUITE 290, MENLO PARK CA 94025
Neil S Subin	other: Former 10% Owner	2336 S.E. OCEAN BOULEVARD, #400, STUART FL 34996
Presidio Management Group Ix, L.l.c.	10 percent owner	2735 SAND HILL ROAD, MENLO PARK CA 94025
Steven M Krausz	10 percent owner	2735 SAND HILL ROAD, MENLO PARK CA 94025
U S Venture Partners Ix L P	10 percent owner	2735 SAND HILL RD, MENLO PARK CA 94025