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Lux Health Tech Acquisition (Lux Health Tech Acquisition) Predictability Rank


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What is Lux Health Tech Acquisition 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.

Lux Health Tech Acquisition 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

Lux Health Tech Acquisition Predictability Rank Related Terms

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Lux Health Tech Acquisition (Lux Health Tech Acquisition) Business Description

Industry
GURUFOCUS.COM » STOCK LIST » Financial Services » Diversified Financial Services » Lux Health Tech Acquisition Corp (NAS:LUXA) » Definitions » Predictability Rank
Comparable Companies
BFAC FRXB GIIX ERES GFX PSPC IVCB WALD SLCR CNDB GSHN PSTH XAMS:EPIC ASZ CCYC CVII KAHC DWAC IPOF PBAJ
Traded in Other Exchanges
N/A
Address
920 Broadway, 11th Floor, New York, NY, USA, 10010
Website
https://www.luxcapital.com
Lux Health Tech Acquisition Corp is a blank check company.
Executives
Frederic H Moll director C/O INTUITIVE SURGICAL INC, 950 KIFER ROAD, SUNNYVALE CA 94086
Joshua Defonzo director, officer: Chief Executive Officer 1500 CORDILLERAS AVENUE, SAN CARLOS CA 94070
Peter Hebert director, 10 percent owner C/O LUX VENTURES, 295 MADISON AVE, 24TH FLOOR, NEW YORK NY 10017
J Robert Kerrey director NEW SCHOOL UNIVERSITY, 66 W. 12TH STREET, NEW YORK NY 10036
Josh Wolfe 10 percent owner C/O LUX HEALTH TECH ACQUISITION CORP., 920 BROADWAY, 11TH FLOOR, NEW YORK NY 10010
Bijan Salehizadeh director C/O NAVIMED CAPITAL, 1333 H STREET NW, SUITE 400 WEST, WASHINGTON DC 20005
Segolene Scarborough officer: CFO and Treasurer C/O LUX HEALTH TECH ACQUISITION CORP., 920 BROADWAY, 11TH FLOOR, NEW YORK NY 10010
Lux Encore Sponsor, Lp 10 percent owner C/O LUX HEALTH TECH ACQUISITION CORP., 920 BROADWAY, 11TH FLOOR, NEW YORK NY 10010
Lux Encore Holdings, Llc 10 percent owner C/O LUX HEALTH TECH ACQUISITION CORP., 920 BROADWAY, 11TH FLOOR, NEW YORK NY 10010

Lux Health Tech Acquisition (Lux Health Tech Acquisition) Headlines

From GuruFocus

Lux Health Tech Acquisition Corp. Announces the Separate Trading of its Class A Common Stock and Warrants, Commencing December 14, 2020

By Business Wire Business Wire • 12-11-2020

Lux Health Tech Acquisition Corp. Announces Closing of $345 Million Initial Public Offering

By Business Wire Business Wire • 10-29-2020