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NNUP (Nocopi Technologies) Predictability Rank


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What is Nocopi Technologies Predictability Rank?

1 (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.


Nocopi 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

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

Nocopi Technologies Predictability Rank Related Terms

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Nocopi Technologies Business Description

Traded in Other Exchanges
N/A
Address
480 Shoemaker Road, Suite 104, King of Prussia, PA, USA, 19406
Nocopi Technologies Inc develops and markets specialty reactive inks. The main business activities of the company are the development and distribution of document security products and the licensing of its patented reactive ink technologies for the entertainment toy and document and product authentication markets in the United States and foreign countries. The primary geographic markets of the company are North America, South America, Europe, Asia, and Australia. Geographically, the company receives maximum revenue from Asia.
Executives
Michael Liebowitz 10 percent owner 4400 BISCAYNE BLVD, 10TH FLOOR, MIAMI FL 33137
Matthew C. Winger director, officer: EVP - Corporate Development 4400 BISCAYNE BLVD, MIAMI FL 33137
Frost Gamma Investments Trust 10 percent owner 4400 BISCAYNE BLVD, MIAMI FL 33137
Frost Phillip Md Et Al 10 percent owner 4400 BISCAYNE BLVD, MIAMI FL 33137-3227
Jacqueline Joy Goldman director 6000 SAN JOSE BLVD., UNIT 705, JACKSONVILLE FL 32217
Debra Elyse Glickman officer: Chief Financial Officer 21 BARSTOW ROAD, APT. 6L, GREAT NECK NY 11021
Joseph S Steinberg 10 percent owner C/O LEUCADIA NATIONAL CORP, 315 PARK AVENUE SOUTH, NEW YORK NY 10010
Howard Timothy Eriksen 10 percent owner 567 WILDROSE CIRCLE, LYNDEN WA 98264
Joseph Kevin Raymond director 480 SHOEMAKER RD., KING OF PRUSSIA PA 19406
Michael Feinstein director, officer: Chairman and CEO
Philip White director 13519 MADISON AVENUE, OCEAN CITY MD 21842
Marc Rash director C/O NOCOPI TECHNOLOGIES, INC., 480 SHOEMAKER ROAD, STE 104, KING OF PRUSSIA PA 19406
Terry Stovold officer: Chief Operating Officer C/O NOCOPI TECHNOLOGIES, INC., 480 SHOEMAKER ROAD, STE 104, KING OF PRUSSIA PA 19406
William Ward Carey director 12 FIELDVIEW LANE, EAST HAMPTON NY 11937
Curtis William Patrick Jr director 225 STATE ROAD, MEDIA PA 19063

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