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Plum Acquisition I (Plum Acquisition I) Predictability Rank


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What is Plum Acquisition I 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.

Plum Acquisition I 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

Plum Acquisition I Predictability Rank Related Terms

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Plum Acquisition I (Plum Acquisition I) Business Description

Industry
GURUFOCUS.COM » STOCK LIST » Financial Services » Diversified Financial Services » Plum Acquisition Corp I (NAS:PLMIU) » Definitions » Predictability Rank
Comparable Companies
LCA SAMA PACI TLGY BRD FLFV FRXB TWLV ALSA IRAA PBAJ SVMB SCRM CVII AAC GHIX ALCC AACT DWAC SAGA
Traded in Other Exchanges
PLMI:USA
Address
2021 Fillmore Street, Suite 2089, San Francisco, CA, USA, 94115
Website
https://www.plumpartners.com
Plum Acquisition Corp I is a blank check company.
Executives
Brian Kevin Turner director C/O MICROSOFT CORPORATION, ONE MICROSOFT WAY, REDMOND WA 98052-6399
Ursula M Burns director, 10 percent owner, officer: Executive Chairwoman 200 SE MIZNER BLVD, UNIT 703, BOCA RATON FL 33432
Jennifer Ceran director C/O QUOTIENT TECHNOLOGY INC., 400 LOGUE AVE, MOUNTAIN VIEW CA 94043
Lane Bess director C/O ZSCALER INC, 110 ROSE ORCHARD WAY, SAN JOSE CA 95134
Kelly Wright director C/O TABLEAU SOFTWARE, INC., 837 NORTH 34TH ST., SUITE 200, SEATTLE WA 98103
Alok Sama director C/O BLUERIVER ACQUSITION CORP., 250 WEST NOTTINGHAM DRIVE SUITE 400, SAN ANTONIO TX 78209
Plum Partners, Llc director, 10 percent owner 2021 FILLMORE STREET, SUITE 2089, SAN FRANCISCO CA 94115
Mike John Dinsdale director, 10 percent owner, officer: See Remarks C/O PLUM ACQUISITION CORP. I, 339 SEAVIEW AVE, PIEDMONT CA 94610
Kanishka Roy director, 10 percent owner, officer: President C/O PLUM ACQUISITION CORP. I, 339 SEAVIEW AVE, PIEDMONT CA 94610
Vinodka Murria director C/O PLUM ACQUISITION CORP. I, 339 SEAVIEW AVE, PIEDMONT CA 94610
Clay Whitehead director, 10 percent owner, officer: Chief Executive Officer C/O PLUM ACQUISITION CORP. I, 339 SEAVIEW AVE, PIEDMONT CA 94610

Plum Acquisition I (Plum Acquisition I) Headlines

From GuruFocus

Veea, Inc. and Plum Acquisition Corp. I Announce Letter of Intent for a Business Combination

By GlobeNewswire • 11-13-2023

GLAZER CAPITAL, LLC Acquires Stake in Plum Acquisition Corp I

By GuruFocus Research • 07-12-2023