What is GE HealthCare Technologies 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.
GE HealthCare Technologies 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
GE HealthCare Technologies (GE HealthCare Technologies) Business Description
Traded in Other Exchanges
Address
500 West Monroe Street, Chicago, IL, USA, 60661
GE HealthCare Technologies Inc is a globally medical technology, pharmaceutical diagnostics, and digital solutions innovator company. It has four operating segments; Imaging, Ultrasound, Patient Care Solutions (PCS), and Pharmaceutical Diagnostics (PDx). It earns a majority of its revenue from the Imaging segment.
Executives
| Kevin Michael O'neill |
officer: CEO, PDx |
500 W. MONROE STREET, CHICAGO IL 60661 |
| Roland Rott |
officer: CEO, Ultrasound |
500 W. MONROE STREET, CHICAGO IL 60661 |
| James Saccaro |
officer: Chief Financial Officer |
ONE BAXTER PARKWAY, DEERFIELD IL 60015 |
| Jan Makela |
officer: CEO, Imaging |
500 W. MONROE STREET, CHICAGO IL 60661 |
| Taha Kass-hout |
officer: Chief Technology Officer |
500 W. MONROE STREET, CHICAGO IL 60661 |
| Kenneth R. Stacherski |
officer: Ch. Supply Chain & Serv. Ofc. |
500 W MONROE, CHICAGO IL 60661 |
| Culp H Lawrence Jr |
director |
GENERAL ELECTRIC COMPANY, ONE FINANCIAL CENTER, SUITE 3700, BOSTON MA 02111 |
| William J Stromberg |
director |
100 E. PRATT STREET, BALTIMORE MD 21202 |
| Thomas J. Westrick |
officer: CEO, Patient Care Solutions |
500 W. MONROE STREET, CHICAGO IL 60661 |
| Yang Watkin Phoebe L. |
director |
C/O DOXIMITY, INC., 500 THIRD STREET, SAN FRANCISCO CA 94107 |
| Rodney F Hochman |
director |
21919 30TH DR SE, BOTHELL WA 98021 |
| Tomislav Mihaljevic |
director |
ONE FINANCIAL CENTER, SUITE 3700, BOSTON MA 02111 |
| Lloyd Jr Howell |
director |
8283 GREENSBORO DRIVE, MCLEAN VA 22102 |
| Anne T Madden |
director |
C/O HONEYWELL 300 S. TRYON STREET, CHARLOTTE NC 28202 |
| Frank R Jimenez |
officer: GC & Corporate Secretary |
GE HEALTHCARE TECHNOLOGIES INC., 500 W. MONROE ST., CHICAGO IL 606061 |
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