What is Sarepta Therapeutics Predictability Rank?
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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.
Sarepta Therapeutics 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
Sarepta Therapeutics (Sarepta Therapeutics) Business Description
Traded in Other Exchanges
Address
215 First Street, Suite 415, Cambridge, MA, USA, 02142
Sarepta Therapeutics Inc is a biotechnology company focused on treating rare, infectious, and other diseases. It targets a broad range of diseases while focusing on the rapid development of its drug candidates. Sarepta's strategy involves proprietary RNA-targeted technology platforms to be used for developing novel pharmaceutical products to treat a broad range of diseases and address key unmet medical needs. The company uses third-party contractors to manufacture its product candidates. Most of Sarepta's product candidates are at an early stage of development.
Executives
| Richard Barry |
director |
285 MARGALITA DRIVE, SAN RAFAEL CA 94901 |
| Douglas S Ingram |
director, officer: President & CEO |
2525 DUPONT DR, IRVINE CA 92612 |
| Michael Andrew Chambers |
director |
215 FIRST STREET, CAMBRIDGE MA 02142 |
| Wigzell Hans Lennart Rudolf |
director |
OSKAR BAECKSTROMSV.11, HAGERSTEN V7 12935 |
| Bilal Arif |
officer: Chief Tech Ops Officer |
215 FIRST STREET, CAMBRIDGE MA 02129 |
| Stephen Mayo |
director |
2000 GALLOPING HILL RD, KENILWORTH NJ 07033 |
| Kathryn Jean Boor |
director |
3736 S. MAIN STREET, MARION NY 14505 |
| Louise Rodino-klapac |
officer: Chief Scientific Officer |
215 FIRST STREET, STE 415, CAMBRIDGE MA 02142 |
| M Kathleen Behrens |
director |
6701 KAISER DRIVE, FREMONT CA 94555 |
| Ryan Edward Brown |
officer: SVP, General Counsel |
215 FIRST STREET, STE 415, CAMBRIDGE MA 02142 |
| Ian Michael Estepan |
officer: Chief Financial Officer |
215 FIRST STREET, STE 415, CAMBRIDGE MA 02142 |
| Joseph Bratica |
officer: Principal Financial Officer |
215 FIRST STREET, STE 415, CAMBRIDGE MA 02142 |
| David T Howton |
officer: SVP, General Counsel |
VERTEX PHARMACEUTICALS INCORPORATED, 130 WAVERLY STREET, CAMBRIDGE MA 02139 |
| John C Martin |
director |
333 LAKESIDE DRIVE, FOSTER CITY X1 94404 |
| Sandesh Mahatme |
officer: Senior Vice President, CFO |
C/O CELGENE CORPORATION, 86 MORRIS AVENUE, SUMMIT NJ 07901 |
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