What is D-Wave Quantum 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.
D-Wave Quantum 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
D-Wave Quantum (D-Wave Quantum) Business Description
Traded in Other Exchanges
Address
3033 Beta Avenue, Burnaby, BC, CAN, V5G 4M9
D-Wave Quantum Inc is engaged in the development and delivery of quantum computing systems, software, and services, and is also a commercial supplier of quantum computers. It delivers customer value with practical quantum applications for problems as diverse as logistics, artificial intelligence, materials sciences, drug discovery, scheduling, cybersecurity, fault detection, and financial modeling. Geographically, it derives a majority of its revenue from the United States.
Executives
| Diane Nguyen |
officer: General Counsel |
3033 BETA AVENUE, BURNABY A1 V5G4M9 |
| Victoria Brydon |
officer: See remarks |
3033 BETA AVENUE, BURNABY A1 V5G 4M9 |
| Smalley Philip Adam Iii |
director |
3033 BETA AVENUE, BURNABY A1 V5G4M9 |
| Ziv Ehrenfeld |
director |
3033 BETA AVENUE, BURNABY A1 V5G4M9 |
| Steven M West |
director |
3033 BETA AVENUE, BURNABY A1 V5G 4M9 |
| Goldman Sachs Group Inc |
10 percent owner |
200 WEST STREET, NEW YORK NY 10282 |
| Goldman Sachs & Co. Llc |
10 percent owner |
200 WEST STREET, NEW YORK NY 10282 |
| Stone Street 2014 Holdings, L.p. |
10 percent owner |
P.O BOX 309 UGLAND HOUSE, GEORGE TOWN E9 KY1-1104 |
| 2014 Employee Offshore Aggregator, L.p. |
10 percent owner |
P.O BOX 309 UGLAND HOUSE, GEORGE TOWN E9 KY1-1104 |
| 2014, L.p. Mbd |
10 percent owner |
200 WEST STREET, NEW YORK NY 10282-2198 |
| Bridge Street 2014, L.p. |
10 percent owner |
200 WEST STREET, NEW YORK NY 10282-2198 |
| Broad Street Principal Investments, L.l.c. |
10 percent owner |
200 WEST STREET, NEW YORK NY 10282 |
| Roger Biscay |
director |
1545 RIVER PARK DRIVE, SUITE 210, SACRAMENTO CA 95815 |
| Alan E Baratz |
director, officer: President & CEO |
3033 BETA AVENUE, BURNABY A1 V5G 4M9 |
| Gelderen Eduard Van |
director |
3033 BETA AVENUE, BURNABY A1 V5G 4M9 |
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