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TLGA.U (TLG Acquisition One) Predictability Rank


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What is TLG Acquisition One 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.


TLG Acquisition One 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

TLG Acquisition One Predictability Rank Related Terms

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TLG Acquisition One Business Description

Traded in Other Exchanges
N/A
Address
515 North Flagler Drive, Suite 520, West Palm Beach, FL, USA, 33401
TLG Acquisition One Corp is a blank check company.
Executives
Petrina Thomson officer: Chief Financial Officer 625 N. FLAGLER DRIVE, SUITE 1003, WEST PALM BEACH FL 33401
Jan Klube officer: Chief Technology Officer 625 N. FLAGLER DRIVE, SUITE 1003, WEST PALM BEACH FL 33401
Carol L Coughlin director C/O HAMILTON BANCORP, INC., 501 FAIRMOUNT AVENUE, SUITE 200, TOWSON MD 21286
Jennifer Elaine Lowry director 2 HOLLINS AVE, BALTIMORE MD 21210
Neha Palmer director 1021 MAIN ST., SUITE #1960, HOUSTON TX 77002
Gbif Management Ltd. director, 10 percent owner 2345 YONGE STREET, SUITE 804, TORONTO A6 M4P 2E5
Hoof James Van Jr officer: See Remarks 625 N. FLAGLER DRIVE SUITE 1003, WEST PALM BEACH FL 33401
Gideon Soesman director 625 N. FLAGLER DRIVE SUITE 1003, WEST PALM BEACH FL 33401
Frank A Magnotti director, officer: Chief Executive Officer C/O COMVERGE, INC., 120 EAGLE ROCK AVENUE, SUITE 190, EAST HANOVER NJ 07936
Kristina A. Peterson director C/O BLINK CHARGING CO., 605 LINCOLN ROAD, 5TH FLOOR, MIAMI BEACH FL 33139
Zainabu Oke director 8300 GOLF LINKS ROAD, OAKLAND CA 94605
Edward Ho director 1775 TYSONS BOULEVARD, TYSONS VA 22102
Tlg Acquisition Founder Llc 10 percent owner 515 NORTH FLAGLER DRIVE, SUITE 520, WEST PALM BEACH FL 33401
Kristin Muhlner director 3877 FAIRFAX RIDGE ROAD, SOUTH TOWER, FAIRFAX VA 22030
David L Johnson director, officer: Chief Financial Officer ONE DELL WAY, ROUND ROCK TX 78682

TLG Acquisition One Headlines

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