GURUFOCUS.COM » STOCK LIST » Financial Services » Banks » Home Bancorp Inc (NAS:HBCP) » Definitions » Predictability Rank

HBCP (Home Bancorp) Predictability Rank


View and export this data going back to 2008. Start your Free Trial

What is Home Bancorp Predictability Rank?

5 (5)

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.


Home Bancorp 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

PredictablesNon-PredictableAll stocks
Total Number of stocks57018332403
Total Lost Money61830891
Total Lost More Than 50%18412430
Total Lost More Than 90%48690
Average Gain260.6%100.0%138.1%
Median Gain150.0%13.0%39.0%
Maximum Gain2852.0%11483.0%11483.0%
Maximum Loss-100.0%-100.0%-100.0%
Annualized Average Gain12.7%6.7%8.4%
Annualized Median Gain8.9%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 Rank5-Star4.5-Star4-Star3.5-Star3-Star2.5-Star2-Star1-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

Home Bancorp Predictability Rank Related Terms

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


Home Bancorp Business Description

Traded in Other Exchanges
N/A
Address
503 Kaliste Saloom Road, Lafayette, LA, USA, 70508
Home Bancorp Inc is engaged in attracting deposits from the public and using those funds to invest in loans and securities. The principal sources of funds are customer deposits, repayments of loans, repayments of investments and funds borrowed from outside sources such as the Federal Home Loan Bank of Dallas. These funds are used for the origination of loans, including one-to-four-family first mortgage loans, home equity loans, and lines, commercial real estate loans, construction and land loans, multi-family residential loans, commercial and industrial loans, and consumer loans. Its primary expenses are interest expense on deposits and borrowings and general operating expenses.
Executives
Daniel G Guidry director HOME BANCORP, INC., 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
David T. Kirkley officer: EVP & Chief Financial Officer 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Chris P Rader director 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Donald W Washington director 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
John Scott Ballard director 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Ann Forte Trappey director 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Michael P. Maraist director HOME BANCORP, INC., 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70598
Jason Freyou officer: EVP/Chief Operations Officer 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Joseph B Zanco officer: Executive Vice President & CFO 200 WEST CONGRESS STREET, LAFAYETTE LA 70501
John W. Bordelon director, officer: President and CEO HOME BANCORP, INC., 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Darren E. Guidry officer: Executive Vice President HOME BANCORP, INC., 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Blanchet Paul J. Iii director HOME BANCORP, INC., 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Kathy J Bobbs director 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Mark M Cole director HOME BANCORP, INC., 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70508
Marc W Judice director HOME BANCORP INC, 503 KALISTE SALOOM ROAD, LAFAYETTE LA 70598