Benchmark Electronics (Benchmark Electronics) Predictability Rank

View and export this data going back to 1990. Start your Free Trial

What is Benchmark Electronics 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.

Benchmark Electronics 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

Benchmark Electronics Predictability Rank Related Terms

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

Benchmark Electronics (Benchmark Electronics) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Hardware » Benchmark Electronics Inc (NYSE:BHE) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

BMU:Germany

Address

56 South Rockford Drive, Tempe, AZ, USA, 85288

Website

https://www.bench.com

Benchmark Electronics Inc is engaged in product designing, engineering services, technology solutions, and advanced manufacturing services (electronic manufacturing services (EMS) and precision technology services). It serves various industries, including aerospace & defense (A&D), medical technologies, complex industrials, semiconductor capital equipment, next-generation telecommunications, and high-end computing. Its geographical segments are the Americas, Asia and Europe of which key revenue is derived from the Americas.

Executives

David Valkanoff	officer: EVP, Chief Operating Officer	C/O BENCHMARK ELECTRONICS INC., 56 SOUTH ROCKFORD DRIVE, TEMPE AZ 85288
David Moezidis	officer: EVP, Chief Commercial Officer	C/O BENCHMARK ELECTRONICS INC., 56 SOUTH ROCKFORD DRIVE, TEMPE AZ 85288
Douglas Britt	director	1500 WEST UNIVERSITY PARKWAY, SARASOTA FL 34243
Jeffrey Stephen Mccreary	director	C/O MIPS TECHNOLOGIES, INC., 955 EAST ARQUES AVENUE, SUNNYVALE CA 94085
Jeff Benck	director, officer: President and CEO	BENCHMARK ELECTRONICS, INC., 56 SOUTH ROCKFORD DRIVE, TEMPE AZ 85281
Rhonda R Turner	officer: Chief Human Resources Officer	20410 NORTH 19TH AVENUE, STE 200, PHOENIX AZ 85027
Ramesh Gopalakrishnan	director	8501 NORTH SCOTTSDALE ROAD, SUITE 100, SCOTTSDALE AZ 85253
Greef-safft Anne De	director	11 KEEWAYDIN DRIVE, SUITE 300, SALEM NH 03079
Roop Kalyan Lakkaraju	officer: CFO	BENCHMARK ELECTRONICS, INC., 56 SOUTH ROCKFORD DRIVE, TEMPE AZ 85281
Lynn A Wentworth	director	CINCINNATI BELL INC, P O BOX 2301, CINCINNATI OH 45201
Lisa K Weeks	officer: Vice President	56 SOUTH ROCKFORD DRIVE, TEMPE AZ 85281
Douglas G Duncan	director	1715 AARON BRENNER DR STE 600, MEMPHIS TN 38120
Robert K Gifford	director	370 WABASHA STREET NORTH, ST. PAUL MN 55102
Robert Crawford	officer: Chief Revenue Officer	56 SOUTH ROCKFORD DRIVE, TEMPE AZ 85281
Stephen J Beaver	officer: VP and General Counsel	7440 E. EDWARD LANE, SCOTTSDALE AZ 85250