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Wisconsin Electric Power Co (Wisconsin Electric Power Co) Predictability Rank


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What is Wisconsin Electric Power Co 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.

Wisconsin Electric Power Co 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

Wisconsin Electric Power Co Predictability Rank Related Terms

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Wisconsin Electric Power Co (Wisconsin Electric Power Co) Business Description

Industry
GURUFOCUS.COM » STOCK LIST » Utilities » Utilities - Regulated » Wisconsin Electric Power Co (OTCPK:WELPP.PFD) » Definitions » Predictability Rank
Comparable Companies
RSERF EUSP BLXX SUME WNDW MGFCF FKRNF CRIUF AZRE SPKE TREAY AZZBF KEN FPHHF AESAY TRPWF COELF EDN HFSUF CPXWF
Traded in Other Exchanges
WELPM.PFD:USA
Address
231 West Michigan Street, P.O. Box 2046, Milwaukee, WI, USA, 53201
Website
https://www.wecenergygroup.com
Wisconsin Electric Power Co is an electric utility company. The business activity of the group is functioned through electric and natural gas utility operations. Its electric utility operations are engaged in the generation, distribution, and sale of electricity in southeastern, east central, and northern Wisconsin and the Upper Peninsula of Michigan. The electric utility operations also include steam operations which produce, distribute, and sell steam to space heating and processing customers in metropolitan Milwaukee, Wisconsin. Its natural gas utility operations are engaged in the purchase, distribution, and sale of natural gas to retail customers and the transportation natural gas in three service areas within southeastern, east central, and northern Wisconsin.
Executives
Paul J Spicer director 231 WEST MICHIGAN STREET, MILWAUKEE WI 53203
William Mastoris director 231 WEST MICHIGAN STREET, MILWAUKEE WI 53203
Xia Liu director, officer: EVP and CFO ONE ENERGY PLACE, PENSACOLA FL 32520
Anthony Reese officer: Vice President and Treasurer 231 WEST MICHIGAN STREET, MILWAUKEE WI 53203
Margaret C Kelsey officer: EVP and Gen Counsel
Gale E Klappa director, officer: CEO and Chairman of the Board 231 W. MICHIGAN STREET, MILWAUKEE WI 53203
Tom Metcalfe officer: Exec. VP - Generation 231 W. MICHIGAN STREET, MILWAUKEE WI 53203
James A. Schubilske officer: Vice President & Treasurer 231 W. MICHIGAN STREET, MILWAUKEE WI 53203
William J Guc officer: Vice President & Controller 130 EAST RANDOLPH DRIVE, CHICAGO IL 60601
Scott J Lauber officer: Vice President and Treasurer 231 W. MICHIGAN STREET, MILWAUKEE WI 53203
Joan M Shafer officer: Exec VP-HR & Org Effectiveness 231 W. MICHIGAN STREET, MILWAUKEE WI 53203
Henry W Knueppel director 200 STATE STREET, BELOIT WI 53511
James Patrick Keyes officer: Executive VP & CFO 231 W. MICHIGAN STREET, MILWAUKEE WI 53203
Susan H. Martin officer: Executive VP & General Counsel 231 W. MICHIGAN STREET, MILWAUKEE WI 53203
Mary Ellen Stanek director 14730 WEST JUNEAU BOULEVARD, ELM GROVE WI 53122

Wisconsin Electric Power Co (Wisconsin Electric Power Co) Headlines

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