What is Spartan Energy 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.
Spartan Energy 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
| 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
Spartan Energy Acquisition (Spartan Energy Acquisition) Business Description
Traded in Other Exchanges
N/A
Address
9 West 57th Street, 43rd Floor, New York, NY, USA, 10019
Spartan Energy Acquisition Corp is a blank check company formed for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination.
Executives
| Glazer Capital, Llc |
10 percent owner |
250 WEST 55TH STREET, SUITE 30A, NEW YORK NY 10019 |
| Paul J Glazer |
10 percent owner |
250 WEST 55TH ST, SUITE 30A, NEW YORK NY 10019 |
| John J Macwilliams |
director |
P O BOX 22027, TULSA OK 74121 |
| Apollo Management Holdings Gp, Llc |
10 percent owner |
9 W. 57TH STREET, 43RD FLOOR, NEW YORK NY 10019 |
| Apollo Management Holdings, L.p. |
10 percent owner |
9 W. 57TH STREET, NEW YORK NY 10019 |
| Apollo Commodities Management, L.p. |
10 percent owner |
2711 CENTERVILLE ROAD, SUITE 400, WILMINGTON DE 19808 |
| Gregory A Beard |
10 percent owner |
C/O ATHLON ENERGY INC., 420 THROCKMORTON STREET, SUITE 1200, FORT WORTH TX 76102 |
| Geoffrey Strong |
10 percent owner |
C/O APOLLO MANAGEMENT, 9 W. 57TH STREET, 43RD FLOOR, NEW YORK NY 10019 |
| Apollo Natural Resources Partners Ii, L.p. |
10 percent owner |
ONE MANHATTANVILLE ROAD, SUITE 201, PURCHASE NY 10577 |
| Spartan Energy Acquisition Sponsor Llc |
10 percent owner |
9 WEST 57TH STREET, 43RD FLOOR, NEW YORK NY 10019 |
| Jan C. Wilson |
director |
18 A HAZELTON AVE., SUITE 606, TORONTO A6 M5R 2E2 |
| J Michael Stice |
director |
525 CENTRAL PARK DRIVE, OKLAHOMA CITY OK 73105 |
| Robert C Reeves |
director |
1001 LOUISIANA STREET, HOUSTON TX 77002 |
| James Crossen |
officer: CFO and CAO |
9 WEST 57TH STREET, 43RD FLOOR, NEW YORK NY 10019 |
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