Pediatrix Medical Group (Pediatrix Medical Group) Predictability Rank

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What is Pediatrix Medical Group 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.

Pediatrix Medical Group 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

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Pediatrix Medical Group (Pediatrix Medical Group) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Healthcare Providers & Services » Pediatrix Medical Group Inc (NYSE:MD) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

MD:Mexico PDC:Germany

Address

1301 Concord Terrace, Sunrise, FL, USA, 33323

Website

https://www.pediatrix.com

Pediatrix Medical Group Inc provides physician services to hospitals, intensive care units, and other medical units. The services provided by the company include maternal care for expectant mothers, intensive care for premature babies, cardiology care for infants suffering from heart defects, and anesthesia care during surgeries, among others. The company operates only under one segment, which is physician services. The company generates roughly half of its revenue from the women's and children's services provided, and also roughly half of the company's total revenue is earned in the United States.

Executives

James D Swift	officer: EVP, Chief Operating Officer	1301 CONCORD TERRACE, SUNRISE FL 33323
Moore Mary Ann E	officer: EVP Chief ERM/Legal Ops Off	1301 CONCORD TERRACE, SUNRISE FL 33323
Mark S Ordan	director, officer: Chief Executive Officer	7315 WISCONSIN AVENUE, SUITE #250 WEST, BETHESDA MD 20814
Shirley A Weis	director	11621 RESEARCH CIRCLE, GAINESVILLE FL 32615
Sylvia Jean Young	director	C/O LINCOLN EDUCATIONAL SERVICES CORPORA, 14 SYLVAN WAY, STE. A, PARSIPPANY NJ 07054
Lee Wood	officer: EVP, Natl & Market Operations	1301 CONCORD TERRACE, SUNRISE FL 33323
Curtis Pickert	officer: EVP, Chief Operating Officer	1301 CONCORD TERRACE, SUNRISE FL 33323
Laura A Linynsky	director	1301 CONCORD TERRACE, SUNRISE FL 33323
Roger Md Medel	director, officer: PRES. & CHIEF EXEC. OFFICER	1301 CONCORD TERRACE, SUNRISE FL 33323
John C Pepia	officer: Principal Accounting Officer	1301 CONCORD TERRACE, SUNRISE FL 33323
Roger Mack Hinson	officer: Pres., PDX & OBX Medical Group	C/O MEDNAX, INC., 1301 CONCORD TERRACE, SUNRISE FL 33323
C Marc Richards	officer: EVP, Chief Financial Officer	7315 WISCONSIN AVENUE, SUITE 250-W, BETHESDA MD 20814
Dominic J Andreano	officer: Sr.VP,General Counsel & Secy.	1301 CONCORD TERRACE, SUNRISE FL 33323
Nicholas Nikolopoulos	officer: EVP Chf Strategy & Growth Offi	MEDNAX INC, 1301, SUNRISE FL 33323
Guy P Sansone	director	C/O MEDNAX, 1301 CONCORD TERRACE, SUNRISE FL 33323