Avrobio (Avrobio) Predictability Rank

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What is Avrobio 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.

Avrobio 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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Avrobio (Avrobio) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Healthcare » Biotechnology » Avrobio Inc (NAS:AVRO) » Definitions » Predictability Rank

Comparable Companies

Traded in Other Exchanges

N/A

Address

100 Technology Square, Sixth Floor, Cambridge, MA, USA, 02139

Website

https://www.avrobio.com

Avrobio Inc is a clinical-stage gene therapy company. It is engaged in developing potentially curative ex vivo lentiviral gene therapies to treat rare diseases following a single dose treatment regimen. The company's pipeline includes AVR-RD-04 for the treatment of cystinosis; AVR-RD-02 for the treatment of Gaucher disease type 1; AVR-RD-05 for the treatment of Hunter syndrome; AVR-RD-06 for the treatment of Gaucher disease type 3; and AVR-RD-03 for the treatment of Pompe disease.

Executives

Azadeh Golipour	officer: Chief Technology Officer	ONE KENDALL SQUARE, BLD. 300 - SUITE 201, CAMBRIDGE MA 02139
Essra Ridha	officer: Chief Medical Officer	C/O AVROBIO, INC., ONE KENDALL SQUARE, BLDG 300 - SUITE 201, CAMBRIDGE MA 02139
Philip J. Vickers	director	C/O REVANCE THERAPEUTICS, INC., 7555 GATEWAY BOULEVARD, NEWARK CA 94560
Christopher Mason	officer: Chief Scientific Officer	C/O KRYSTAL BIOTECH, INC., 2100 WHARTON STREET, SUITE 701, PITTSBURGH PA 15203
Phillip B. Donenberg	director	C/O AVEXIS, INC., 2275 HALF DAY ROAD, SUITE 200, BANNOCKBURN IL 60015
Diana Escolar	officer: Chief Medical Officer	C/O MIRAGEN THERAPEUTICS, INC., 6200 LOOKOUT ROAD, BOULDER CO 80301
Gail M Farfel	director	142 TEMPLE STREET, SUITE 205, NEW HAVEN CT 06510
Deanna M Petersen	officer: Chief Business Officer	45 FIRST AVENUE, WALTHAM MA 02451
Geoffrey Mackay	director, officer: See Remarks	C/O AVROBIO, INC., ONE KENDALL SQ, BLDG. 300, STE. 201, CAMBRIDGE MA 02139
Christopher Paige	director	C/O AVROBIO INC, ONE KENDALL SQ, BLDG 300, STE 201, CAMBRIDGE MA 02139
Atlas Venture Fund X, L.p.	10 percent owner	400 TECHNOLOGY SQUARE, 10TH FLOOR, CAMBRIDGE MA 02139
Atlas Venture Associates Opportunity I, Llc	other: See Remarks	400 TECHNOLOGY SQUARE, 10TH FLOOR, CAMBRIDGE MA 02139
Atlas Venture Associates Opportunity I, L.p.	other: See Remarks	400 TECHNOLOGY SQUARE, 10TH FLOOR, CAMBRIDGE MA 02139
Atlas Venture Opportunity Fund I, L.p.	other: See Remarks	400 TECHNOLOGY SQUARE, 10TH FLOOR, CAMBRIDGE MA 02139
Bruce Booth	director	890 WINTER STREET, SUITE 320, WALTHAM MA 02451