What is Provectus Biopharmaceuticals Predictability Rank?
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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.
Provectus Biopharmaceuticals 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
Provectus Biopharmaceuticals Business Description
Traded in Other Exchanges
N/A
Address
800 South Gay Street, Suite 1610, Knoxville, TN, USA, 37929
Provectus Biopharmaceuticals Inc is a clinical-stage biotechnology company developing immunotherapy medicines for different diseases that are based on a class of synthetic small molecule immuno-catalysts called halogenated xanthenes (HXs). Its HX molecule is named rose bengal sodium. The company's proprietary, patented, pharmaceutical-grade RBS is the active pharmaceutical ingredient in the drug product candidates of its current clinical development programs and the preclinical formulations of its current drug discovery programs.
Executives
| Jeffrey Allen Morris |
10 percent owner |
1729 TRIANGLE PARK DR., MARYVILLE TN 37801 |
| Webster Bailey |
director |
10025 INVESTMENT DRIVE, SUITE 250, KNOXVILLE TN 37932 |
| Heather Raines |
officer: Chief Financial Officer |
10025 INVESTMENT DRIVE, SUITE 250, KNOXVILLE TN 37932 |
| Edward Pershing |
director |
2220 SOUTHERLAND AVE, KNOXVILLE TN 37919 |
| John Iii Lacy |
director |
10025 INVESTMENT DRIVE, SUITE 250, KNOXVILLE TN 37932 |
| John R Glass |
officer: See Remarks |
7327 OAK RIDGE HIGHWAY SUITE A, KNOXVILLE TN 37931 |
| Bruce Horowitz |
director |
7327 OAK RIDGE HIGHWAY, KNOXVILLE TN 37931 |
| Dominic Rodrigues |
director |
7327 OAK RIDGE HIGHWAY, KNOXVILLE TN 37931 |
| Peter R Culpepper |
officer: Interim CEO, CFO, COO |
7327 OAK RIDGE HWY, SUITE A, OAK RIGE TN 37931 |
| Eric Phd Wachter |
director, officer: Chief Technology Officer |
PROVECTUS PHARMACEUTICALS INC, 7327 OAK RIDGE HIGHWAY, KNOXVILLE TN 37931 |
| Jan Koe |
director |
7327 OAK RIDGE HIGHWAY, KNOXVILLE TN 37931 |
| Smith Alfred E. Iv |
director |
191 MAIN STREET, NEW CANAAN CT 06840 |
| Kelly M Mcmasters |
director |
7327 OAK RIDGE HIGHWAY, KNOXVILLE TN 37931 |
| Donald E Adams |
10 percent owner |
370 CRESTMONT DRIVE, SAN LUIS OBISPO CA 93401 |
| Timothy Phd Scott |
director, 10 percent owner, officer: President |
PROVECTUS PHARMACEUTICALS INC, 7327 OAK RIDGE HIGHWAY, KNOXVILLE TN 37931 |
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