HashiCorp (HashiCorp) Predictability Rank

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What is HashiCorp 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.

HashiCorp 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

HashiCorp Predictability Rank Related Terms

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HashiCorp (HashiCorp) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » HashiCorp Inc (NAS:HCP) » Definitions » Predictability Rank

Comparable Companies

ESMT EEFT SQSP VRNS FIVN BOX TDC FLYW STNE WIX MSFT ORCL ADBE PANW SNPS VMW FTNT CRWD PLTR SQ

Traded in Other Exchanges

HCP:Mexico YR8:Germany

Address

101 Second Street, Suite 700, San Francisco, CA, USA, 94105

Website

https://www.hashicorp.com

HashiCorp Inc is engaged in solving the infrastructure challenges of cloud adoption by enabling an operating model that unlocks the full potential of modern public and private clouds. Its cloud operating model provides consistent workflows and a standardized approach to automate the processes involved in delivering applications in the cloud: infrastructure provisioning, security, networking, and application deployment. Its main commercial products are Terraform, Vault, Consul, and Nomad.

Executives

Armon Dadgar	director, 10 percent owner, officer: Chief Technology Officer	C/O HASHICORP INC., 101 SECOND STREET, SUITE 700, SAN FRANCISCO CA 94105
Navam Welihinda	officer: Chief Financial Officer	C/O HASHICORP INC., 101 SECOND STREET, SUITE 700, SAN FRANCISCO CA 94105
Marc Holmes	officer: Chief Marketing Officer	C/O HASHICORP, INC., 101 SECOND STREET, SUITE 700, SAN FRANCISCO CA 94105
Ledger Susan St.	director	C/O OKTA, INC., 100 FIRST STREET, SUITE 600, SAN FRANCISCO CA 94105
David Mcjannet	director, officer: CEO & Chairman	C/O HASHICORP, INC., 101 SECOND STREET, SUITE 700, SAN FRANCISCO CA 94105
Brandon Sweeney	officer: Chief Revenue Officer	C/O HASHICORP, INC., 101 SECOND STREET, SUITE 700, SAN FRANCISCO CA 94105
Sigal Zarmi	director	1501 YAMATO ROAD, BOCA RATON FL 33431
David J Henshall	director	18880 HOMESTEAD ROAD, CUPERTINO CA 95014
Mayfield Xiv, A Cayman Islands Exempted Limited Partnership	10 percent owner	2484 SAND HILL ROAD, MENLO PARK CA 94025
Glenn Solomon	director, 10 percent owner	C/O GGV CAPITAL, 3000 SAND HILL ROAD, SUITE 4-230, MENLO PARK CA 94025
Ggv Capital Select L.l.c.	10 percent owner	3000 SAND HILL ROAD, SUITE 4-230, MENLO PARK CA 94025
Ggv Capital V L.l.c.	10 percent owner	3000 SAND HILL ROAD, BUILDING 4, SUITE 230, MENLO PARK CA 94025
Mayfield Select Management (egp), L.p.	10 percent owner	2484 SAND HILL ROAD, MENLO PARK CA 94025
Mf Leaders H-e, L.p.	10 percent owner	2484 SAND HILL ROAD, MENLO PARK CA 94025
Mf Leaders Management, L.l.c.	10 percent owner	C/O MAYFIELD, 2484 SAND HILL ROAD, MENLO PARK CA 94025