Dana (DAN) Predictability Rank

View and export this data going back to 2008. Start your Free Trial

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.

Dana 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

Dana Predictability Rank Related Terms

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

Dana (DAN) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Consumer Cyclical » Vehicles & Parts » Dana Inc (NYSE:DAN) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

4DH:Germany

Address

3939 Technology Drive, Maumee, OH, USA, 43537

Website

https://www.dana.com

Dana Inc is engaged in the designing and manufacturing of efficient propulsion and energy-management solutions that power vehicles and machines in all mobility markets across the globe. The company's portfolio improves the efficiency, performance, and sustainability of light vehicles, commercial vehicles, and off-highway equipment. From axles, driveshafts, transmissions, sealing, and thermal products to electrifications products including motors, inverters, controllers, e-sealing, e-thermal and digital solutions The company operates in four reportable segments Light Vehicle Drive Systems, Commercial Vehicle Drive & Motion Systems, Off-Highway Drive & Motion Systems, and Power Technologies. The maximum revenue is derived from the Light Vehicle Drive Systems segment.

Executives

Jeroen Decleer	officer: SVP & Pres Off-Highway Drive	GEMENEWEIDEWEG-NOORD 18, BRUGGE C9 8310
Aziz Aghili	officer: Pres Off-Hwy Technologies & AP	5706 KIRKRIDGE TRAIL, ROCHESTER HILLS MI 48306
James D Kellett	officer: VP & Chief Accounting Officer	3946 WRENS NEST BLVD, MAUMEE OH 43537
James Kevin Kamsickas	director, officer: President & CEO	44011 CYPRESS POINT DRIVE, NORTHVILLE MI 48168
Byron S Foster	officer: Pres, Light Veh Drive Systems	30 ISABELLA ST., PITTSBURGH PA 15212
Brett Icahn	director	C/O ICAHN ENTERPRISES L.P., 16690 COLLINS AVE., PH, SUNNY ISLES FL 33160
Gaoxiang Hu	director	16690 COLLINS AVE., SUITE PH-1, SUNNY ISLES BEACH FL 33160
Ernesto M Hernandez	director	C/O CONSTELLATION BRANDS, INC., 207 HIGH POINT DRIVE, BLDG. 100, VICTOR NY 14564
Timothy R Kraus	officer: SVP & Chief Financial Officer	812, PILGRAM AVENUE, BIRMINGHAM MI 48009
Robert D Pyle	officer: Pres, Light Vehicle Driveline	3939 TECHNOLOGY DRIVE, MAUMEE OH 43537
Jonathan Mark Collins	officer: SVP & Chief Financial Officer	50196 VENICE COURT, NORTHVILLE MI 48168
Ryan Laskey	officer: SVP - Commercial Veh Drive	9332 CRISTAL MARIE CT, TEMPERANCE MI 48182
Antonio Valencia	officer: Pres. Power Technologies Group	3939 TECHNOLOGY DRIVE, MAUMEE OH 43537
Keith E Wandell	director
Bridget E Karlin	director	3 TALL TREE LANE, PLEASANTVILLE NY 10570