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SYBX (Synlogic) Predictability Rank


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What is Synlogic Predictability Rank?

1 (5)

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.


Synlogic 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

Synlogic Predictability Rank Related Terms

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


Synlogic Business Description

Traded in Other Exchanges
Address
PO Box 30, Winchester, MA, USA, 01890
Synlogic Inc is a biopharmaceutical company focuses on rare metabolic disorders, with a lead program in phenylketonuria (PKU) and homocystinuria (HCU). The company's pipeline includes therapeutics for enteric hyperoxaluria, gout, and cystinuria. Using a proprietary approach, the company engineer GI-restricted, oral medicines from well-characterized probiotics. These drug candidates target specific biological pathways, leveraging Escherichia coli Nissle 1917 for consistency and safety. Engineered to be non-colonizing and reversible, the company offer oral administration, simplifying shipping and storage. The company operates in one segment-discovery and development of Synthetic Biotics-pioneering transformative treatments for serious diseases.
Executives
Antoine Awad officer: Chief Operating Officer C/O SYNLOGIC, INC., 301 BINNEY STREET, SUITE 402, CAMBRIDGE MA 02142
Michael Vangsted Jensen officer: Chief Financial Officer 301 BINNEY STREET, SUITE 402, CAMBRIDGE MA 02142
Aoife Brennan officer: Chief Medical Officer 200 SIDNEY STREET, SUITE 320, C/O SYNLOGIC, INC., CAMBRIDGE MA 02139
Lisa Kelly-croswell director C/O SYNLOGIC, INC., 301 BINNEY STREET, SUITE 402, CAMBRIDGE MA 02142
Michael Thomas Heffernan director C/O CORNERSTONE THERAPEUTICS INC., 1255 CRESCENT GREEN DRIVE, SUITE 250, CARY NC 27518
Michael F. Burgess director C/O SYNLOGIC, INC., 301 BINNEY STREET, SUITE 402, CAMRIDGE MA 02142
Richard P Shea director C/O MOMENTA PHARMACEUTICALS, INC., 43 MOULTON STREET, CAMBRIDGE MA 02138
Gregg Beloff officer: See Remarks C/O CERULEAN PHARMA INC., 840 MEMORIAL DRIVE, CAMBRIDGE MA 02139
Richard J. Riese officer: Chief Medical Officer C/O SYNLOGIC, INC., 301 BINNEY STREET, SUITE 402, CAMBRIDGE MA 02142
Ginkgo Bioworks, Inc. 10 percent owner 27 DRYDOCK AVENUE, 8TH FLOOR, BOSTON MA 02210
Scott Eric Plevy officer: Chief Scientific Officer 301 BINNEY STREET, #402, C/O SYNLOGIC, INC., CAMBRIDGE MA 02142
Paul Francis Miller officer: Chief Scientific Officer 200 SIDNEY STREET, SUITE 320, C/O SYNLOGIC, INC., CAMBRIDGE MA 02139
Patricia N. Hurter director C/O SYNLOGIC, INC., 301 BINNEY ST., SUITE 402, CAMBRIDGE MA 02142
Andrew Gengos officer: See Remarks 21900 BURBANK BOULEVARD, 3RD FLOOR, WOODLAND HILLS CA 91367
Todd Shegog officer: See Remarks 200 SIDNEY STREET, SUITE 320, C/O SYNLOGIC, INC., CAMBRIDGE MA 02139

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