Lightbridge (Lightbridge) Predictability Rank

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What is Lightbridge Predictability Rank?

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.

Lightbridge 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

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Lightbridge (Lightbridge) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Industrials » Industrial Products » Lightbridge Corp (NAS:LTBR) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

N7ON:Germany

Address

11710 Plaza America Drive, Suite 2000, Reston, VA, USA, 20190

Website

https://www.ltbridge.com

Lightbridge Corp is a United States-based nuclear fuel technology company. The business activity of the firm is functioned through Nuclear Fuel Technology segment. The Nuclear Fuel Technology segment develops next generation nuclear fuel technology that increases the power output of commercial reactors and reduces the cost of generating electricity. Geographically, its operations are functioned through the region of Unites States.

Executives

Sherri Goodman	director	C/O LIGHTBRIDGE CORPORATION, 11710 PLAZA AMERICA DRIVE, SUITE 2000, RESTON VA 20190
Ak Jensen Investment Management Ltd	10 percent owner	1 CORNHILL, LONDON X0 EC3V 3ND
Mark Robert Tobin	director	C/O LIGHTBRIDGE CORPORATION, 11710 PLAZA AMERICA DRIVE, SUITE 2000, RESTON VA 20190
Sweta Chakraborty	director	C/O LIGHTBRIDGE CORPORATION, 11710 PLAZA AMERICA DRIVE, SUITE 2000, RESTON VA 20190
Jesse L. Funches	director	C/O LIGHTBRIDGE CORPORATION, 11710 PLAZA AMERICA DRIVE, SUITE 2000, RESTON VA 20190
Thomas Jr Graham	director, officer: Chairman	C/O LIGHTBRIDGE CORPORATION, 11710 PLAZA AMERICA DRIVE, SUITE 2000, RESTON VA 20190
Larry Goldman	officer: Chief Financial Officer	C/O LIGHTBRIDGE CORPORATION, 11710 PLAZA AMERICA DRIVE, SUITE 2000, RESTON VA 20190
Seth Grae	director, officer: CEO and President	C/O LIGHTBRIDGE CORPORATION, 11710 PLAZA AMERICA DRIVE, SUITE 2000, RESTON VA 20190
Andrey Mushakov	officer: EVP, Nuclear Operations	C/O LIGHTBRIDGE CORPORATION, 11710 PLAZA AMERICA DRIVE, SUITE 2000, RESTON VA 20190
Linda Joan Zwobota	officer: Interim CFO	102 HARBOUR SOUND DRIVE, CHESTER MD 21619
Xingping Hou	director	SUITE 1501, PLAZA B, JIANWAI SOHU, NO. 39, EASTERN THREE RING MIDDLE ROAD, BEIJING F4 100020
Awm Investment Company, Inc.	10 percent owner	527 MADISON AVENUE, SUITE 2600, NEW YORK NY 10022
Marxe Austin W & Greenhouse David M	10 percent owner	C/O SPECIAL SITUATIONS FUNDS, 527 MADISON AVENUE, SUITE 2600, NEW YORK NY 10022
Kathleen Townsend	director	C/O LIGHTBRIDGE CORPORATION, 11710 PLAZA AMERICA DRIVE, SUITE 2000, RESTON VA 20190
James Guerra	officer: COO and CFO	423 CUMNOR ROAD, KENILWORTH IL 60043