VRTC (Veritec) Predictability Rank

View and export this data going back to . Start your Free Trial

What is Veritec Predictability Rank?

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.

Veritec 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

Veritec Predictability Rank Related Terms

Thank you for viewing the detailed overview of Veritec's Predictability Rank provided by GuruFocus.com. Please click on the following links to see related term pages.

Veritec Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » Veritec Inc (OTCPK:VRTC) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

N/A

Address

2445 Winnetka Avenue North, Golden Valley, MN, USA, 55427

Website

https://www.veritecinc.com

Veritec Inc is engaged in the development, marketing, sales, and licensing of products and rendering of professional services. The company renders professional services related to mobile banking technology. Its mobile banking technology is used to offer Prepaid Card Programs to sponsor banks and approved applicants/cardholders. The products and services offered by the company include MTC Debit Card Visa Prepaid Card Programs, blinx ON-OFF Debit Card Visa Prepaid Card Programs, Custom Branded Debit Card Programs, and blinxPay Mobile Wallet App. Geographically, it derives revenue from the United States.

Executives

Matthews Group, Llc	10 percent owner	2445 WINNETKA AVENUE, GOLDEN VALLEY MN 55427
Van Thuy Tran	director, 10 percent owner, officer: CEO & President	2445 WINNETKA AVENUE, GOLDEN VALLEY MN 55427
Lawrence J Johanns	10 percent owner	2445 WINNETKA AVENUE, GOLDEN VALLEY MN 55427
Laird E. Powers	director	530 HAWTHORNE COURT, LOS ALTOS CA 94024
David Christopher Reiling	director	4516 FREMONT AVENUE SOUTH, MINNEAPOLIS MN 55419
Robert W Junghans	director	2 SKILLMAN LANE, NORTH OAKS MN 55127
Jeffrey J Hattara	officer: Chief Executive Officer	319 BARRY AVENUE SOUTH, SUITE 300, WAYZATA MN 55391
Gerald David Fors	officer: CFO	7321-15TH AVE. SO., RICHFIELD MN 55423
Larry Matthews	director	7601 5TH AVE., RICHFIELD MN 55423
Charles E Boyer	director

Veritec Headlines

From GuruFocus

VERITEC SIGNED JOINT VENTURE WITH VIVA ENTERTAINMENT GROUP AKA VIVALIVETV (OTTV)

By PRNewswire PRNewswire • 05-23-2023