What is AnaptysBio 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.
AnaptysBio 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
AnaptysBio Business Description
Traded in Other Exchanges
Address
10770 Wateridge Circle, Suite 210, San Diego, CA, USA, 92121
AnaptysBio Inc is a clinical-stage biotechnology company. The company is focused on developing antibody product candidates for unmet medical needs in inflammation and immuno-oncology. The company is developing immune cell modulating antibodies, including two wholly owned checkpoint agonists in clinical-stage development, for autoimmune and inflammatory diseases; rosnilimab, PD-1 agonist in a Phase 2b trial for the treatment of moderate-to-severe rheumatoid arthritis (RA) and a Phase 2 trial for the treatment of moderate-to-severe ulcerative colitis (UC); and ANB032, BTLA agonist, in a Phase 2b trial for the treatment of moderate-to-severe atopic dermatitis (AD).
Executives
| Ecor1 Capital, Llc |
10 percent owner |
357 TEHAMA STREET #3, SAN FRANCISCO CA 94103 |
| Hollings Renton |
director |
|
| Paul F. Lizzul |
officer: Chief Medical Officer |
30699 RUSSELL RANCH ROAD, SUITE 140, WESTLAKE VILLAGE CA 91362 |
| Eric J Loumeau |
officer: General Counsel |
C/O HOLLIS-EDEN PHARMACEUTICALS, 4435 EASTGATE MALL STE.400, SAN DIEGO CA 92121 |
| Dennis Mulroy |
officer: Chief Financial Officer |
|
| Dennis M Fenton |
director |
|
| Daniel Faga |
director |
3737 MARKET STREET, SUITE 1300, PHILADELPHIA PA 19104 |
| John A Orwin |
director |
C/O RELYPSA, INC., 700 SAGINAW DR., REDWOOD CITY CA 94063 |
| Rita Jain |
director |
C/O AKEBIA THERAPEUTICS, INC., 245 FIRST STREET, SUITE 1100, CAMBRIDGE MA 02142 |
| Hamza Suria |
director, officer: President, CEO |
C/O ANAPTYSBIO, INC., 10421 PACIFIC CENTER COURT, SUITE 200, SAN DIEGO CA 92121 |
| Oleg Nodelman |
director, 10 percent owner |
357 TEHAMA STREET #3, SAN FRANCISCO CA 94103 |
| Magda Marquet |
director |
ALTHEADX INC., 3550 DUNHILL STREET, SAN DIEGO CA 92121 |
| J. Anthony Ware |
director |
C/O ANAPTYSBIO, INC., 10421 PACIFIC CENTER COURT, SUITE 200, SAN DIEGO CA 92121 |
| Laura Hamill |
director |
333 LAKESIDE DRIVE, FOSTER CITY CA 94404 |
| Marco Londei |
officer: Chief Medical Officer |
C/O ANAPTYSBIO, INC., 10421 PACIFIC CENTER COURT, SUITE 200, SAN DIEGO CA 92121 |
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